Suppose Stan Holds a Portfolio Consisting of a $10,000 Investment

question 132

Multiple Choice

Suppose Stan holds a portfolio consisting of a $10,000 investment in each of 8 different common stocks.The portfolio's beta is 1.25.Now suppose Stan decided to sell one of his stocks that has a beta of 1.00 and to use the proceeds to buy a replacement stock with a beta of 1.35.What would the portfolio's new beta be?

• A) 1.17
• B) 1.23
• C) 1.29
• D) 1.36
• E) 1.43

Understand the challenges and strategies associated with managing in times of uncertainty and potential downsizing.

Identify the most common benefits and support provided to displaced workers.

Recognize the impacts of downsizing on both terminated workers and survivors within an organization.

Comprehend the significance of organizational initiatives such as outplacement programs in supporting displaced workers.

---

Definitions:

Security Issued

Financial instruments that are offered for sale by a corporation or a government entity, typically in the form of stocks or bonds.

Cost of Equity

The return that investors require for an investment in a company, representing the compensation for the risk taken.

Financing

Allocating resources for the purposes of business ventures, buying goods, or making investments.

Risk

The potential for losing something of value, or the potential for an investment's actual return to differ from its expected return.