Which of the Following Statements Is CORRECT

question 56

Multiple Choice

Which of the following statements is CORRECT?

• A) Beta is measured by the slope of the security market line.
• B) If the risk-free rate rises,then the market risk premium must also rise.
• C) If a company's beta is halved,then its required return will also be halved.
• D) If a company's beta doubles,then its required return will also double.
• E) The slope of the security market line is equal to the market risk premium, (r_M - r_RF).

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Definitions:

Widely Used

Refers to something that is employed or adopted on a large scale across various regions or groups.

Drug

is a substance that alters the body's physiology or psychology when consumed. Drugs can be legal (prescription medications) or illegal (substances banned by law).

Rich

refers to individuals or entities possessing substantial wealth, assets, or financial resources, enabling a lifestyle of comfort and luxury.

Capable Guardians

Persons or entities that are effective in preventing crime by their mere presence or by taking protective actions.