Which statement about risk is TRUE?

Select one:

a. If you add enough randomly selected stocks to a portfolio, you can completely eliminate all of the market risk from the portfolio.

b. If you believe the stock market is about to rise sharply, you should sell your high-beta stocks and buy low-beta stocks in order to take advantage of the expected market move.

c. A portfolio that consists of all stocks in the market would have a required return that is equal to the risk-free rate.

d. An investor can eliminate virtually all diversifiable risk if he or she holds a very large, well-diversified portfolio of stocks.

A bank makes a 6% $100,000 discount loan for one year. What is the real effective interest rate (to 2 decimals) on the loan?

Enter only numbers and decimal: Answer %

A share of common stock has just paid a dividend today of $8. If the expected growth rate for this stock is 4%, and if investors required rate of return is 7%, what is the expected stock price? $ Answer