7. (TCO 7) If the market rate of return is 10% and the beta on a particular stoc

Question

7. (TCO 7) If the market rate of return is 10% and the beta on a particular stock is .78, the return on the stock will be: (Points : 3)
greater than 10%.
greater or less than 10%, depending on the risk-free rate of return.
less than 10%.
dependent on some other factor.


8. (TCO 7) For two investments with a correlation coefficient (rij) equal to +1, the portfolio standard deviation will be __________ the weighted average of the individual investments' standard deviation. (Points : 3)
more than
less than
equal to
zero compared to

Explanation / Answer

greater or less than 10%, depending on the risk-free rate of return. equal to

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