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%

---

Definitions:

Relevant

Pertaining to the matter at hand; closely connected or appropriate to the subject.

Revise Messages

The act of reviewing and altering messages to improve clarity, effectiveness, or accuracy.

Flexible And Unfocused

Describes a situation or approach that is adaptable but lacks a clear direction or objective.

Organization Of A Message

The way in which information is structured and presented in a communication.