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Due on: 12/30/2013
Posted On: 12/13/2013 12:53 PM

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.docx#_edn1" title="">[i]. Currently, the risk-free rate is 6 percent and the market risk premium is 5 percent. On the basis of this information, which of the following statements is most correct?

a. If a stock has a negative beta, its required return must also be negative.

b. If a stock’s beta doubles, its required return must also double.

c. An index fund with beta = 1.0 has a required return of 11 percent.

d. Statements a and c are correct.

e. Statements b and c are correct.

.docx#_edn2" title="">[ii]. Which of the following statements is incorrect?

a. The slope of the security market line is measured by beta.

b. Two securities with the same stand-alone risk can have different betas.

c. Company-specific risk can be diversified away.

d. The market risk premium is affected by attitudes about risk.

e. Higher beta stocks have a higher required return.

.docx#_edn3" title="">[iii]. Which of the following statements is most correct?

a. The slope of the security market line is beta.

b. The slope of the security market line is the market risk premium, (kM – kRF).

c. If you double a company’s beta its required return more than doubles.

d. Statements a and c are correct.

e. Statements b and c are correct.

.docx#_edn4" title="">[iv]. Stock A has a beta of 1.2 and a standard deviation of 20 percent. Stock B has a beta of 0.8 and a standard deviation of 25 percent. Portfolio P is a $200,000 portfolio consisting of $100,000 invested in Stock A and $100,000 invested in Stock B. Which of the following statements is most correct? (Assume that the required return is determined by the Security Market Line.)

a. Stock B has a higher required rate of return than Stock A.

b. Portfolio P has a standard deviation of 22.5 percent.

c. Portfolio P has a beta equal to 1.0.

d. Statements a and b are correct.

e. Statements a and c are correct.

.docx#_edn5" title="">[v]. Nile Foods’ stock has a beta of 1.4 and Elbe Eateries’ stock has a beta of 0.7. Assume that the risk-free rate, kRF, is 5.5 percent and the market risk premium, (kM – kRF), equals 4 percent. Which of the following statements is most correct?

a. Since Nile’s beta is twice that of Elbe’s, its required rate of return will also be twice that of Elbe’s.

b. If the risk-free rate increases but the market risk premium remains unchanged, the required return will increase for both stocks but the increase will be larger for Nile since it has a higher beta.

c. If the market risk premium increases but the risk-free rate remains unchanged, Nile’s required return will increase (since it has a beta greater than 1.0) but Elbe’s will decline (since it has a beta less than 1.0).

d. All of the statements above are correct.

e. None of the statements above is correct.

.docx#_edn6" title="">[vi]. Stock X has a beta of 0.6, while Stock Y has a beta of 1.4. Which of the following statements is most correct?

a. Stock Y must have a higher expected return and a higher standard deviation than Stock X.

b. A portfolio consisting of $50,000 invested in Stock X and $50,000 invested in Stock Y will have a required return that exceeds that of the overall market.

c. If the market risk premium decreases (but expected inflation is unchanged), the required return on both stocks will decrease but the decrease will be greater for Stock Y.

d. If expected inflation increases (but the market risk premium is unchanged), the required return on both stocks will decrease by the same amount.

e. If expected inflation decreases (but the market risk premium is unchanged), the required return on both stocks will decrease but the decrease will be greater for Stock Y.

.docx#_edn7" title="">[vii]. Stock A has a beta of 0.8 and Stock B has a beta of 1.2. 50 percent of Portfolio P is invested in Stock A and 50 percent is invested in Stock B. If the market risk premium (kM – kRF) were to increase but the risk-free rate (kRF) remained constant, which of the following would occur?

a. The required return will decrease by the same amount for both Stock A and Stock B.

b. The required return will increase for both stocks but the increase will be greater for Stock B than for Stock A.

c. The required return will increase for Stock A but will decrease for Stock B.

d. The required return will increase for Stock B but will decrease for Stock A.

e. The required return on Portfolio P will remain unchanged.

.docx#_edn8" title="">[viii]. Stock A has a beta of 0.7, whereas Stock B has a beta of 1.3. Portfolio P has 50 percent invested in both Stocks A and B. Which of the following would occur if the market risk premium increased by
1 percentage point? (Assume that the risk-free rate remains constant.)

a. The required return for Stock A would fall but the required return for Stock B would increase.

b. The required return for Portfolio P would remain unchanged.

c. The required return for both stocks would increase by 1 percentage point.

d. The required return for Stock A would increase by more than
1 percentage point, while the return for Stock B would increase by less than 1 percentage point.

e. The required return for Portfolio P would increase by 1 percentage point.

.docx#_edn9" title="">[ix]. Assume that the risk-free rate remains constant, but that the market risk premium declines. Which of the following is likely to occur?

a. The required return on a stock with a beta = 1.0 will remain the same.

b. The required return on a stock with a beta < 1.0 will decline.

c. The required return on a stock with a beta > 1.0 will increase.

d. Statements b and c are correct.

e. All of the statements above are correct.

.docx#_edn10" title="">[x]. Which of the following statements is most correct?

a. The slope of the security market line is beta.

b. A stock with a negative beta must have a negative required rate of return.

c. If a stock’s beta doubles its required rate of return must double.

d. If a stock has a beta equal to 1.0, its required rate of return will be unaffected by changes in the market risk premium.

e. None of the statements above is correct.

.docx#_edn11" title="">[xi]. Which of the following statements is most correct?

a. Portfolio diversification reduces the variability of the returns on the individual stocks held in the portfolio.

b. If an investor buys enough stocks, he or she can, through diversification, eliminate virtually all of the non­market (or company-specific) risk inherent in owning stocks. Indeed, if the portfolio contained all publicly traded stocks, it would be riskless.

c. The required return on a firm’s common stock is determined by its systematic (or market) risk. If the systematic risk is known, and if that risk is expected to remain constant, then no other information is required to specify the firm’s required return.

d. A security’s beta measures its nondiversifiable (systematic, or market) risk relative to that of an average stock.

e. A stock’s beta is less relevant as a measure of risk to an investor with a well-diversified portfolio than to an investor who holds only that one stock.


.docx#_edn12" title="">[xii]. Consider the following information for three stocks, Stock A, Stock B, and Stock C. The returns on each of the three stocks are positively correlated, but they are not perfectly correlated. (That is, all of the correlation coefficients are between 0 and 1.)

Expected Standard

Stock Return Deviation Beta

Stock A 10% 20% 1.0

Stock B 10 20 1.0

Stock C 12 20 1.4

Portfolio P has half of its funds invested in Stock A and half invested in Stock B. Portfolio Q has one third of its funds invested in each of the three stocks. The risk-free rate is 5 percent, and the market is in equilibrium. (That is, required returns equal expected returns.) Which of the following statements is most correct?

a. Portfolio P has a standard deviation of 20 percent.

b. Portfolio P’s coefficient of variation is greater than 2.0.

c. Portfolio Q’s expected return is 10.67 percent.

d. Portfolio Q has a standard deviation of 20 percent.

e. Portfolio P’s required return is greater than the required return on Stock A.

Medium:

.docx#_edn13" title="">[xiii]. You have developed the following data on three stocks:

StockStandard DeviationBeta

A 0.15 0.79

B 0.25 0.61

C 0.20 1.29

If you are a risk minimizer, you should choose Stock if it is to be held in isolation and Stock if it is to be held as part of a well-diversified portfolio.

a. A; A

b. A; B

c. B; A

d. C; A

e. C; B


.docx#_edn14" title="">[xiv]. Assume that investors become increasingly risk averse, so that the market risk premium increases. Also, assume that the risk-free rate and expected inflation remain the same. Which of the following is most likely to occur?

a. The required rate of return will decline for stocks that have betas less than 1.0.

b. The required rate of return on the market, kM, will remain the same.

c. The required rate of return for each stock in the market will increase by an amount equal to the increase in the market risk premium.

d. Statements a and b are correct.

e. None of the statements above is correct.

.docx#_edn15" title="">[xv]. In a portfolio of three different stocks, which of the following could not be true?

a. The riskiness of the portfolio is less than the riskiness of each of the stocks if each were held in isola­tion.

b. The riskiness of the portfolio is greater than the riskiness of one or two of the stocks.

c. The beta of the portfolio is less than the beta of each of the individual stocks.

d. The beta of the portfolio is greater than the beta of one or two of the individual stocks’ betas.

e. None of the above (that is, they all could be true, but not necessarily at the same time).

.docx#_edn16" title="">[xvi]. Stock A has an expected return of 10 percent and a standard deviation of 20 percent. Stock B has an expected return of 12 percent and a standard deviation of 30 percent. The risk-free rate is 5 percent and the market risk premium, kM - kRF, is 6 percent. Assume that the market is in equilibrium. Portfolio P has 50 percent invested in Stock A and 50 percent invested in Stock B. The returns of Stock A and Stock B are independent of one another. (That is, their correlation coefficient equals zero.) Which of the following statements is most correct?

a. Portfolio P’s expected return is 11 percent.

b. Portfolio P’s standard deviation is less than 25 percent.

c. Stock B’s beta is 1.25.

d. Statements a and b are correct.

e. All of the statements above are correct.


.docx#_edn17" title="">[xvii]. Stock A has a beta of 1.2 and a standard deviation of 25 percent. Stock B has a beta of 1.4 and a standard deviation of 20 percent. Portfolio P was created by investing in a combination of Stocks A and B. Portfolio P has a beta of 1.25 and a standard deviation of 18 percent. Which of the following statements is most correct?

a. Portfolio P has the same amount of money invested in each of the two stocks.

b. The returns of the two stocks are perfectly positively correlated (r = 1.0).

c. Stock A has more market risk than Stock B but less stand-alone risk.

d. Portfolio P’s required return is greater than Stock A’s required return.

e. Stock A has more market risk than Portfolio P.

.docx#_edn18" title="">[xviii]. Which of the following statements is most correct?

a. Market participants are able to eliminate virtually all market risk if they hold a large diversified portfolio of stocks.

b. Market participants are able to eliminate virtually all company-specific risk if they hold a large diversified portfolio of stocks.

c. It is possible to have a situation where the market risk of a single stock is less than that of a well diversified portfolio.

d. Statements a and c are correct.

e. Statements b and c are correct.

.docx#_edn19" title="">[xix]. Stock A has a beta = 0.8, while Stock B has a beta = 1.6. Which of the following statements is most correct?

a. Stock B’s required return is double that of Stock A’s.

b. An equally weighted portfolio of Stock A and Stock B will have a beta less than 1.2.

c. If market participants become more risk averse, the required return on Stock B will increase more than the required return for Stock A.

d. All of the statements above are correct.

e. Statements a and c are correct.


.docx#_edn20" title="">[xx]. Which of the following statements is most correct?

a. If you add enough randomly selected stocks to a portfolio, you can completely eliminate all the market risk from the portfolio.

b. If you formed a portfolio that included a large number of low-beta stocks (stocks with betas less than 1.0 but greater than -1.0), the portfolio would itself have a beta coefficient that is equal to the weighted average beta of the stocks in the portfolio, so the portfolio would have a relatively low degree of risk.

c. If you were restricted to investing in publicly traded common stocks, yet you wanted to minimize the riskiness of your portfolio as measured by its beta, then according to the CAPM theory you should invest some of your money in each stock in the market. That is, if there were 10,000 traded stocks in the world, the least risky portfolio would include some shares in each of them.

d. Diversifiable risk can be eliminated by forming a large portfolio, but normally even highly-diversified portfolios are subject to market risk.

e. Statements b and d are correct.

.docx#_edn21" title="">[xxi]. Inflation, recession, and high interest rates are economic events that are characterized as

a. Company-specific risk that can be diversified away.

b. Market risk.

c. Systematic risk that can be diversified away.

d. Diversifiable risk.

e. Unsystematic risk that can be diversified away.

.docx#_edn22" title="">[xxii]. Which of the following statements is most correct?

a. The beta coefficient of a stock is normally found by running a regression of past returns on the stock against past returns on a stock market index. One could also construct a scatter diagram of returns on the stock versus those on the market, estimate the slope of the line of best fit, and use it as beta.

b. It is theoretically possible for a stock to have a beta of 1.0. If a stock did have a beta of 1.0, then, at least in theory, its required rate of return would be equal to the risk-free (default-free) rate of return, kRF.

c. If you found a stock with a zero beta and held it as the only stock in your portfolio, you would by definition have a riskless portfolio. Your 1-stock portfolio would be even less risky if the stock had a negative beta.

d. The beta of a portfolio of stocks is always larger than the betas of any of the individual stocks.

e. All of the statements above are correct.

.docx#_edn23" title="">[xxiii]. You have developed data that give (1) the average annual returns on the market for the past five years, and (2) similar information on Stocks A and B. If these data are as follows, which of the possible answers best describes the historical betas for A and B?

YearsMarketStock AStock B

1 0.03 0.16 0.05

2 -0.05 0.20 0.05

3 0.01 0.18 0.05

4 -0.10 0.25 0.05

5 0.06 0.14 0.05

a. bA> 0; bB = 1

b. bA> +1; bB = 0

c. bA = 0; bB = -1

d. bA< 0; bB = 0

e. bA< -1; bB = 1

.docx#_edn24" title="">[xxiv]. Which of the following statements is most correct?

a. Suppose the returns on two stocks are negatively correlated. One has a beta of 1.2 as determined in a regression analysis, while the other has a beta of -0.6. The returns on the stock with the negative beta will be negatively correlated with returns on most other stocks in the market.

b. Suppose you are managing a stock portfolio, and you have information that leads you to believe the stock market is likely to be very strong in the immediate future. That is, you are confident the market is about to rise sharply. You should sell your high-beta stocks and buy low-beta stocks in order to take advantage of the expected market move.

c. Collections Inc. is in the business of collecting past-due accounts for other companies; that is, it is a collection agency. Collections’ revenues, profits, and stock price tend to rise during recessions. This suggests that Collections Inc.’s beta should be quite high, say 2.0, because it does so much better than most other companies when the economy is weak.

d. Statements a and b are correct.

e. Statements a and c are correct.


.docx#_edn25" title="">[xxv]. Which of the following is not a difficulty concerning beta and its estimation?

a. Sometimes a security or project does not have a past history that can be used as a basis for calculating beta.

b. Sometimes, during a period when the company is undergoing a change such as toward more leverage or riskier assets, the calculated beta will be drastically different than the “true” or “expected future” beta.

c. The beta of an “average stock,” or “the market,” can change over time, sometimes drastically.

d. Sometimes the past data used to calculate beta do not reflect the likely risk of the firm for the future because conditions have changed.




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Tags bank data busine general stock beta return market portfolio statements required risk stocks rate following percent premium invested correct deviation expected standard greater increase returns correcte riskfree correcta aume decrease higher equal security mostcorrecta

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Tutorial Preview …X xxxx (because xxx beta is xxxxxxxx but we xxx told xxxxxxx xxxxx its xxxxxxxx deviation Remember, xxxx has nothing xx do xxxx xxxxxxxx deviation xxxxxxxxxx statement a xx false The xxxxxxxx return xx x portfolio xx $50,000 in xxxx stock will xxxx a xxxxxxxx xxxxxx that xx the weighted xxxxxxx of the xxxxxxx on xxxx xxxxxx Since xxxx one has x weight of xxx it xxxx xx a xxxxxx average The xxxxxxxxxxxxx beta will xx the xxxxxxx xx the xxx betas ((0 x + 1 xxxx = x xx The xxxxxxxxx has the xxxx beta that xxx market xxxxxxxxx xxxx and, xxxxxxxxxx the same xxxxxxxx return that xxx market xxx xxxxxxxxxx statement x is false xx the market xxxx premium xxxxxxxxxx xxx slope xx the SML xxxx decrease Therefore, xxx required xxxxxxx xx stocks xxxx higher betas xxxx decrease more xxxxxxxxxx Stock xxxxx xxxxxxxx return xxxx fall by xxxx than Stock xxxxx Therefore, xxxxxxxxx x is xxxxxxx If the xxxxxxxx inflation increases, xxx SML xxxx xxxx a xxxxxxxx shift up, xxx the required xxxxxxx on xxx xxxxxx will xxxxxxxx by the xxxx amount, not xxxxxxxx Therefore, xxxxxxxxx x is xxxxx If expected xxxxxxxxx decreases, the xxx will xxxx x parallel xxxxx down, and xxx required returns xx all xxxxxx xxxx decrease xx thesame amount xxxxxxxxxx statement e xx false xxxxx xxx Answer: x Remember, the xxxxxx risk premium xx the xxxxx xx the xxxx in the xxx diagram The xxxx is xxxxxxxx xx the xxxxxxx and when xxx market risk xxxxxxx changes, xxx xxxx “rotates” xxxxxx that point xxxx remember the xxx equation xx xx = xxx + (kM x kRF)b Statement x is xxxxxxxx x “parallel xxxxxxxx of the xxxxx and that xx incorrect x xxxxxx of xxx equation shows xxxxx because beta xx multiplied xx xxx market xxxx premium, changes xx the market xxxx premium xxxx xxxxxx stocks xxxx different betas xxxxxxxxxxx Statement b xx correct xxx xxxxx of xxx line will xxxxxxxxx so required xxxxxxx on xxxxxx xxxx betas xxxxxx to 0 xxxx increase by xxxx than xxxxxxx xx stocks xxxx higher betas x review of xxx equation xxxxx xxxx if xxx beta were xxxxxxx a change xx the xxxxxx xxxx premium xxxxx have more xxxxxx on ks xxxx if xxx xxxx were xxxxx Statement c xx false because xx is xxx xxxxxxx of xxxxxxxxx b, which xx have already xxxxxx is xxxx xxxxxxxxx d xx false because xx increase in xxx market xxxx xxxxxxx will xxxxxxxx the required xxxxxx on all xxxxxx with xxxxxxxx xxxxx Statement x is false xxx portfolio beta xx the xxxxxxxx xxxxxxx of xxx individual stocks’ xxxxx In this xxxxx the xxxxxxxxx xxxx will xx 1 0 xx is clear xxxx the xxx xxxxxxxx that x portfolio with x beta of x 0 xxxx xx affected xx changes in xxx market risk xxxxxxx [viii] xxx xxxxxxx e xx the market xxxx premium (kM x kRF) xxxxxxxxxx xxx required xxxxxx on all xxxxxx with positive xxxxx would xxxxxxxx xxxxxxxxxx statement x is false xxxxx the required xxxxxx for xxx xxxxxxxx beta xxxxxx will increase, xxx return for xxxxxxxxx P xxxx xxxxxxxx as xxxx Therefore, statement x is false xxx required xxxxxx xx Stock x will increase xx 0 7 xxxxxxxx and xxx xxxxxxxx return xx Stock B xxxx increase by x 3 xxxxxxx xxxxxxxxxx statement x is false xxxxxxxxx d is xxx opposite xx xxxx would xxxxxxxx happen, so xxxxxxxxx d is xxxxx The xxxx xxx Portfolio x is 1 xxxxxxxx 0 7) x (50%´ x xxx Therefore, xxx change in xxx portfolio’s required xxxxxx will xx xxxxxxx - xxxx = 1 xxx 1% = xx Therefore, xxxxxxxxx x is xxxxxxx [ix] SML xxxxxxx b The xxxxxxx answer xx xxxxxxxxx b xx the risk xxxxxxx declines, then xxx slope xx xxx SML xxxxxxxx At first, xxx line could xx drawn xx x Then xxxx the risk xxxxxxx declines, it xxxx look xxxx xxxx B xxxxxxxxxx a and x are incorrect xxx required xxxxxx xx all xxxxxx will fall xxxxxxxxxx statement b xx correct xxx xxxx CAPM, xxx beta Answer: x Statement e xx correct; xxx xxxxxx are xxxxx The market xxxx premium is xxx slope xx xxx SML xx a stock xxx a negative xxxxx this xxxx xxx mean xxx required return xx negative A xxxxxxxx of x xxxxxxxxx beta xxxxxxxxx mean that xxx required return xxxx double xxx xxxxxxxx return xx a function xx kRF, kM, xxx beta xxx xxxxxxxx return xx affected by xxx market risk xxxxxxx [xi] xxxx xxxxxxxx and xxxxxxxxx diversification Answer: x A security’s xxxx does xxxxxx xxxxxxx market xxxx relative to xxxx of an xxxxxxx stock xxxxxxxxxxxxxxx xxxxxxx the xxxxxxxxxxx of the xxxxxxxxxxxxxx return An xxxxxxxxx through xxxxxxxxxxxxxxxx xxx eliminate xxxxxxxxxxxxxxxx risk; however, x portfolio containing xxx publicly-traded xxxxxx xxxxx still xx exposed to xxxxxx risk The xxxx specifies x xxxxxxxxx required xxxxxx as: ks x kRF + xxx - xxxxx xxxxx the xxxxxxxxx rate and xxx market risk xxxxxxx are xxxxxx xxxxx with x stock’s beta xx determine its xxxxxxxx return x xxxxxxxxx beta xx more relevant xx a measure xx risk xx xx investor xxxx a well-diversified xxxxxxxxx than to xx investor xxx xxxxx only xxxx one stock xxxxx Miscellaneous risk xxxxxxxx Answer: x xxx correct xxxxxx is statement x Statement a xx incorrect xxxxx xxx correlation xx not 1 xxx the standard xxxxxxxxx of xxx xxxxxxxxx is xxxx than 20% xxx the same xxxxxxx Statement x xx also xxxxxxxxx Since Portfolio xxxxx standard deviation xx less xxxx xxxx its xx (s/) is xxxx than 2 x So, xxxxxxxxx x is xxxxxxxxx And, statement x is incorrect xxxxx Portfolio…
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Preview: following xxxxxxxxxx is xxxx correct?a If xxx add enough xxxxxxxx selected xxxxxx xx a xxxxxxxxxx you can xxxxxxxxxx eliminate all xxx market xxxx xxxx the xxxxxxxxx b If xxx formed a xxxxxxxxx that xxxxxxxx x large xxxxxx of low-beta xxxxxx (stocks with xxxxx less xxxx x 0 xxx greater than xx 0), the xxxxxxxxx would xxxxxx xxxx a xxxx coefficient that xx equal to xxx weighted xxxxxxx xxxx of xxx stocks in xxx portfolio, so xxx portfolio xxxxx xxxx a xxxxxxxxxx low degree xx risk c xx you xxxx xxxxxxxxxx to xxxxxxxxx in publicly xxxxxx common stocks, xxx you xxxxxx xx minimize xxx riskiness of xxxx portfolio as xxxxxxxx by xxx xxxxx then xxxxxxxxx to the xxxx theory you xxxxxx invest xxxx xx your xxxxx in each xxxxx in the xxxxxx That xxx xx there xxxx 10,000 traded xxxxxx in the xxxxxx the xxxxx xxxxx portfolio xxxxx include some xxxxxx in each xx them x xxxxxxxxxxxxx risk xxx be eliminated xx forming a xxxxx portfolio, xxx xxxxxxxx even xxxxxxxxxxxxxxxxxx portfolios are xxxxxxx to market xxxx e xxxxxxxxxx x and x are correct xxxxxxx b Inflation, xxxxxxxxxx and xxxx xxxxxxxx rates xxx economic events xxxx are characterized xxx Company-specific xxxx xxxx can xx diversified away x Market risk x Systematic xxxx xxxx can xx diversified away x Diversifiable risk x Unsystematic xxxx xxxx can xx diversified away xxxxxxx a Which xx the xxxxxxxxx xxxxxxxxxx is xxxx correct?a The xxxx coefficient of x stock xx xxxxxxxx found xx running a xxxxxxxxxx of past xxxxxxx on xxx xxxxx against xxxx returns on x stock market xxxxx One xxxxx xxxx construct x scatter diagram xx returns on xxx stock xxxxxx xxxxx on xxx market, estimate xxx slope of xxx line xx xxxx fit, xxx use it xx beta b xx is xxxxxxxxxxxxx xxxxxxxx for x stock to xxxx a beta xx 1 x xx a xxxxx did have x beta of x 0, xxxxx xx least xx theory, its xxxxxxxx rate of xxxxxx would xx xxxxx to xxx risk-free (default-free) xxxx of return, xxx c xx xxx found x stock with x zero beta xxx held xx xx the xxxx stock in xxxx portfolio, you xxxxx by xxxxxxxxxx xxxx a xxxxxxxx portfolio Your xxxxxxx portfolio would xx even xxxx xxxxx if xxx stock had x negative beta x The xxxx xx a xxxxxxxxx of stocks xx always larger xxxx the xxxxx xx any xx the individual xxxxxx e All xx the xxxxxxxxxx xxxxx are xxxxxxx Answer: d xxx have developed xxxx that xxxx xxx the xxxxxxx annual returns xx the market xxx the xxxx xxxx years, xxx (2) similar xxxxxxxxxxx on Stocks x and x xx these xxxx are as xxxxxxxx which of xxx possible xxxxxxx xxxx describes xxx historical betas xxx A and xxxxxxxxxxxxxxxxxx AStock x x 0 xx 0 16 x 05 2 xx 05 x xx 0 xx 3 0 xx 0 18 x 05 x xx 10 x 25 0 xx 5 0 xx 0 xx x 05 x bA> 0; xx = 1b xxxxxx +1; xx x 0c xx = 0; xx = -1d xxxxxx 0; xx x 0e xxxxxx -1; bB x 1Answer: a xxxxx of xxx xxxxxxxxx statements xx most correct?a xxxxxxx the returns xx two xxxxxx xxx negatively xxxxxxxxxx One has x beta of x 2 xx xxxxxxxxxx in x regression analysis, xxxxx the other xxx a xxxx xx -0 x The returns xx the .....
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