When Analyzing Systematic Risk of a Stock,if the Slope of the Regression

question 77

Multiple Choice

When analyzing systematic risk of a stock,if the slope of the regression line is greater than 1,________.

• A)the stock return exceeds market return
• B)the market return and stock return move equally
• C)the stock return increases at a slower rate than market
• D)the stock return and market return are uncorrelated

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Definitions:

Balance Sheet

An account statement that outlines the financial position of a company, including what it owns, owes, and the equity interest of its investors at a given time.

Fair Value Measurements

Assessments of the estimated market value of an asset or liability, based on assumptions about risk and the valuation techniques used.

GAAP Hierarchy

A framework that categorizes the importance and authority of different accounting principles and guidelines in the U.S. Generally Accepted Accounting Principles (GAAP).

Valuation Method

Techniques or approaches used to determine the market value of assets, businesses, or financial instruments.