Bertin Bicycles Has a Beta of 0

question 103

Multiple Choice

Bertin Bicycles has a beta of 0.88 and an expected dividend growth rate of 4.00% per year.The T-bill rate is 4.00%,and the T-bond rate is 5.25%.The annual return on the stock market during the past 4 years was 10.25%.Investors expect the average annual future return on the market to be 11.50%.Using the SML,what is Bertin's required rate of return?

• A)10.48%
• B)10.75%
• C)11.02%
• D)11.29%

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Definitions:

Current Managers

Individuals who presently hold managerial positions within an organization, overseeing and making decisions on personnel and operations.

In-Basket Exercises

Are special forms of work simulations for prospective managers. They consist of collections of hypothetical memos, letters, and notes that require responses.

Self-Report Inventories

Psychometric instruments where individuals provide data about themselves, often used in psychological assessments.

Utility Analyses

A quantitative approach used to assess the economic impact and effectiveness of human resources interventions and decisions.