In: Finance
Diversification can increase the level of systematic risk.
True
False
According to the CAPM, which of the following is NOT related to the expected return on a stock?
A. |
pure time value of money as measured by the risk-free rate |
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B. |
amount of systematic risk as measured by beta |
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C. |
the reward for systematic risk as measured by the market risk premium |
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D. |
amount of risk as measured by the standard deviation |
If a stock does not pay dividends which of the following must be true?
A. |
The P-E must be zero. |
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B. |
The stock price will fall. |
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C. |
The expected return is equal to the expected growth in price. |
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D. |
The stock must have a value of $0. |