The Correlation Coefficient Between a Stock and the Market Portfolio

question 47

Multiple Choice

The correlation coefficient between a stock and the market portfolio is +0.6. The standard deviation of return of the stock is 30 percent and that of the market portfolio is 20 percent. Calculate the beta of the stock.

• A)1.1
• B)1.0
• C)0.9
• D)0.6

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Definitions:

Social Obligations

The responsibilities or duties that individuals feel they owe to others in their social groups or communities.

Job Satisfaction

The level of contentment or happiness an individual feels regarding their job, influenced by factors like work environment, pay, and perceived value.

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Disparities in control, authority, or influence among individuals or groups within a society or organization.

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