Question: What is the expected return of a zero-beta security? a. Market rate of return. b. Zero rate of return. c. Negative rate of return. d.

What is the expected return of a zero-beta security?
a. Market rate of return.
b. Zero rate of return.
c. Negative rate of return.
d. Risk-free rate of return.

Step by Step Solution

★★★★★

3.28 Rating (166 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

d Riskfree rate of return The capital asset pricing model takes into account the assets ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

225-B-A-I (2602).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

What is the expected return of the following investment? Probability pays off 0.3 ................... 30.0 0.2 ................... 10.0 0.5 ................... -2.0

What are the boundaries for the expected return of a portfolio?

Let (X, Yi), i = 1,2,...,n, be a random sample from a bivariate normal distribution. (X1, Y), (X2, Y2),..., (Xn, Yn) are independent. Find the distribution of the vector X X2 : Xn Y Y Yn

Choose the correct answer and explain briefly 8. What is the expected return of a zero-beta security? A. Market rate of return. B Zero rate of return. C. Negative rate of return. D. Risk-free rate of...

Peter Lynch's thumb rule for investing using PEG is: A. Buy if the PEG ratio is lower than 1 B. Buy if PEG ratio is higher than 1 C. Buy if PEG ratio is exactly equal to 1 D. Never use PEG ratio...

5. What is the expected return of a zero-beta security? a. Market rate of return. h. Zero rate of return. CS Scanned Negative rate of return. Cams Risk-free rate of return

What is the expected return of a zero - beta security? The market rate of return. Zero rate of return. A negative ran of return. The risk - free rate.

Question 19 According to the CAPM, what is the expected return of a zero-beta security? A negative rate of return. The market rate of return. The risk-free rate. Zero rate of return.

What is the expected return of a zero-beta security? a. A negative rate of return. b. The risk-free rate. c. The market rate of return. d. Zero rate of return. e. A return higher than the risk-free...

a. What is the expected return of a zero-beta security? b. Your opinion is that security A has an expected rate of return of 0.145. It has a beta of 1.5. The risk-free rate is 0.04, and the market...

Why do you ten to lean backward when carrying a heavy load in your arms?

Study the Amazon case study on pages C171-C183 of Crafting executing strategy the quest for competitive advantage concepts and cases by Margaret A. Peteraf John E. Gamble Alonzo J. Strickland Arthur...

Evaluate the integral. 2 2 1 ( u 7 2 - 1 u 3 ) d u

Determine where each example goes in the circular flow diagram. More than one example may go into a bin. Answer Bank income that Bill obtains from his consulting job Markets for the long hours that...

KA Nitro Corporation purchased an 80% interest in Mars Company on January 1, 20X5, The following determination and distribution of excess schedule was prepared on the purchase date: Price paid for...

Steve and Maggie are a young couple with a 1 year old baby. Steve is an engineer with a salary of 80,000 per annum. After deducting taxes and other deductions, Steve can take home of $2286.47 per...

Sunny Inc. is trying to decide whether investing in Project A is a good idea. This project will last 5 years and will not exist after that. Any salvage value will be considered as an additional cash...

Chad Boudreaux is a 58-year riverboat captain. He grew up in New Orleans and has worked on the Mississippi River his entire life. He works for a private company in New Orleans called Crescent River...

16. What are some of the descriptive statistical tools available in Microsoft Excel, and how can they be used?

Your client chooses to invest 70% of a portfolio in your fund and 30% in a T-bill money market fund. a. What is the expected return and standard deviation of your client's portfolio? b. Suppose your...

Suppose the same client in the previous problem decides to invest in your risky portfolio a proportion (y) of his total investment budget so that his overall portfolio will have an expected rate of...

RefertotheBaseball2016data,whichreportinformationonthe30MajorLeagueBaseballteamsforthe2016season....

Assume an investor deposits $118,485 in a professionally managed account. One year later, the account has grown in value to $132,419 and the investor withdraws $37,019. At the end of the second year,...

The Corner Shop is considering a new four year expansion project that requires an inis al fived asset irvestrient of $210,000. The fued asset will be depreciated straight-line to zero over its...