Quiz Ch 08 – Project Cash Flows and Financial Metrics
Fundamentals of Corporate Finance
Brealey, Myers, and Marcus
10th Edition
Which statement must be true for a specific set of project cash flows?
Which statement must be true for a specific set of project cash flows?
True or false: The CAPM, a multi-period model, considers securities’ maturities and aids in establishing the required rate of return at different systematic risk levels.
True or false: If two investors possess single portfolios, and assume equal unsystematic risks for stocks in both portfolios, Investor A’s portfolio with a beta of -2.0 and Investor B’s portfolio with a beta of +2.0 encounter identical levels of risk. Nevertheless, holders of either portfolio can decrease their risks by the same degree by incorporating “normal” stocks with a beta of 1.0.