The risk-free rate and the expected market rate of return are 6% and 16%, respectively. According to the capital asset pricing model, the expected rate of return on security X with a beta of 1.2 is equal to ________.
A) 12%
B) 17%
C) 18%
D) 23%
Correct Answer:
Verified
Q44: Liquidity is a risk factor that _.
A)
Q45: Consider two stocks, A and B. Stock
Q46: The SML is valid for _, and
Q47: Beta is a measure of _.
A) total
Q48: The risk-free rate is 4%. The expected
Q50: The most significant conceptual difference between the
Q51: One of the main problems with the
Q52: Which of the following variables do Fama
Q53: According to the CAPM, the risk premium
Q54: According to capital asset pricing theory, the
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents