Suppose the Following Equation Best Describes the Evolution of β

question 2

Multiple Choice

Suppose the following equation best describes the evolution of β over time:β_t = 0.4 + 0.6β_{t − 1}.If a stock had a β of 0.9 last year, you would forecast the β to be _______ in the coming year.

• A) 0.45
• B) 0.60
• C) 0.70
• D) 0.94

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Definitions:

Valence Shell

The outermost shell of electrons in an atom that is involved in chemical bonding.

Electron Pair Repulsion Theory

A theory in chemistry that describes the shape of molecular structures in terms of the repulsive forces between electron pairs in the valence shell of the central atom.

Molecular Geometry

The three-dimensional arrangement of atoms within a molecule, determining its reactivity, polarity, phase of matter, color, magnetism, and biological activity.

Water Molecule

A compound consisting of two hydrogen atoms and one oxygen atom bonded together, forming H2O.