Which of the Following Statements Is Correct

question 77

Multiple Choice

Which of the following statements is correct?

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

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Definitions:

Intellectual Functioning

The capacity of the mind to think, learn, and understand effectively and efficiently.

Lewis Terman

A psychologist known for his work in intelligence testing and the longitudinal study of gifted children.

WAIS

Wechsler Adult Intelligence Scale, a standardized test designed to measure intelligence in adults and older adolescents.

Working Memory

A newer understanding of short-term memory that adds conscious, active processing of incoming sensory information, and of information retrieved from long-term memory.