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Which of the Following Statements Is Correct

Question 3

Multiple Choice

Which of the following statements is correct?


A) If the risk-free rate rises, then the market risk premium will also rise.
B) If a company's beta is halved, then its required return will also be halved.
C) If a company's beta doubles, then its required return will also double.
D) The slope of the security market line is equal to the market risk premium, (rM - rRF) .

Correct Answer:

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