What Is the Reliability of the Three Components Connected in Series

question 46

Multiple Choice

What is the reliability of the three components connected in series shown below?

• A)0.799425
• B)0.85000
• C)0.91333
• D)0.95000
• E)2.79

---

Definitions:

Required Return

The minimum rate of return on an investment that investors expect to compensate them for the level of risk.

Beta

A measure of a stock's volatility relative to the overall market, indicating its risk compared to the market average.

Risk-free Rate

The return on investment with no risk of financial loss, often represented by the yield on government securities.

CAPM

Capital Asset Pricing Model; a financial model that describes the relationship between systematic risk and expected return for assets, particularly stocks.