What Is the Expected Return on a Stock with a Beta

question 64

Multiple Choice

What is the expected return on a stock with a beta of 1.09, a market risk premium of 8%, and a risk-free rate of 4%?

• A)4.36%
• B)8.36%
• C)8.72%
• D)12.72%

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Definitions:

Administrative Facilities

Infrastructure and buildings utilized by an organization to support its administrative functions, including offices, headquarters, and other operational spaces.

Insurance Expired

The portion of an insurance premium that applies to the elapsed part of the policy period, representing the cost of coverage that has already been provided.

Indirect

Costs that cannot be directly traced to a specific product or service, such as overhead expenses in manufacturing.

Indirect Material

Materials used in the production process that are not directly identifiable with specific products or jobs, such as lubricants and cleaning supplies.