Stock A's Beta Is 1

question 80

Multiple Choice

Stock A's beta is 1.5 and Stock B's beta is 0.5.Which of the following statements must be true,assuming the CAPM is correct.

• A) Stock A would be a more desirable addition to a portfolio then Stock B.
• B) In equilibrium,the expected return on Stock B will be greater than that on Stock A.
• C) When held in isolation,Stock A has more risk than Stock B.
• D) Stock B would be a more desirable addition to a portfolio than A.
• E) In equilibrium,the expected return on Stock A will be greater than that on B.

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Definitions:

Apical-Radial Pulse

The measurement of heartbeats felt at the apex of the heart and the radial artery simultaneously to assess pulse rate discrepancy.

Pulse Deficit

A clinical finding where there is a difference between the heartbeats felt at the pulse and the beats heard with a stethoscope at the chest, indicating a discrepancy in cardiac output.

Heart Disease

A range of conditions that affect the heart, including blood vessel diseases, heart rhythm problems (arrhythmias), and heart defects one is born with (congenital heart defects), among others.

Blood Pressure

The force exerted by circulating blood on the walls of the body's arteries, essential for the diagnosis and monitoring of cardiovascular health.