World United stock currently plots on the security market line and has a beta of 1.04.Which one of the following will increase that stock's rate of return without affecting the risk level of the stock, all else constant?
A)An increase in the risk-free rate
B)Decrease in the security's beta
C)Overpricing of the stock in the marketplace
D)Increase in the market risk-to-reward ratio
E)Decrease in the market rate of return

Question

Quizplus · Accepted Answer

The Answer of World United stock currently plots on the security market line and has a beta of 1.04.Which one of the following will increase that stock's rate of return without affecting the risk level of the stock, all else constant?
A)An increase in the risk-free rate
B)Decrease in the security's beta
C)Overpricing of the stock in the marketplace
D)Increase in the market risk-to-reward ratio
E)Decrease in the market rate of return

World United Stock Currently Plots on the Security Market Line