Which One of the Following Statements Concerning Beta Is Correct

question 41

Multiple Choice

Which one of the following statements concerning beta is correct?

• A) The beta of a portfolio must be greater than or equal to zero but less than or equal to one.
• B) The beta of a portfolio can be greater than the highest beta of an individual security within the portfolio.
• C) If the weights of the individual securities within a portfolio are changed, the beta of the portfolio will remain constant.
• D) The beta of a portfolio measures the systematic risk of the portfolio and has a value that cannot exceed the value of the highest beta of any individual security in the portfolio.
• E) The beta of a portfolio measures the unsystematic risk of the portfolio and has a value that must be greater than or equal to zero.

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