Chapter 7

3.	The beta of Elsenore, Inc., stock is 1.6, whereas the risk-free rate of return is 8 percent. If the expected return on the market is 15 percent, then what is the expected return on Elsenore?
	A)	11.20%
	B)	19.20%
	C)	24.00%
	D)	32.00%

4. Which of the following is the best measure of the systematic risk in a portfolio?

A) Variance

B) Standard deviation

C) Covariance

D) Beta

5. What is the Beta of a market portfolio?

A) 0

B) 1

C) Not possible to tell

D) -1