Assume the Single-Factor Model Is Applied to a Security That

Multiple Choice

Assume the single-factor model is applied to a security that has a negative factor beta.The security will:

A) always have a positive rate of return.
B) have an expected return greater than the risk-free rate.
C) have an actual return that equals the risk-free rate.
D) have an expected return equal to the market rate of return.
E) have an actual rate of return that can be positive,negative,or zero.