Consider the CAPM

question 74

Multiple Choice

Consider the CAPM. The expected return on the market is 18%. The expected return on a stock with a beta of 1.2 is 20%. What is the risk-free rate?

• A) 2%
• B) 6%
• C) 8%
• D) 12%

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Definitions:

Atom Economy

A measure of the efficiency of a chemical reaction, in terms of how much of the reactants end up in the desired final products.

Circular Economy

An economic system aimed at minimizing waste and making the most of resources by reusing, repairing, refurbishing, and recycling existing materials and products.

International Manufacturing

The production of goods in multiple countries to take advantage of global efficiencies such as lower labor costs.

Chemical Derivatives

are substances that are derived from other substances through chemical processes, often possessing different physical or chemical properties.