Beta Is Defined as ____

question 80

Multiple Choice

Beta is defined as ____.

• A) a measure of volatility of a security's returns relative to the returns of a broad-based market portfolio of securities
• B) the ratio of the variance of market returns to the covariance of returns on a security with the market
• C) the inverse of the slope of the security regression line
• D) All of these are correct

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Definitions:

Dividend

A portion of a company's earnings distributed to shareholders as a return on their investment.

Constant

An unchanging value in an equation or model, or a fixed value that does not vary over time.

Abbot Labs

A multinational healthcare company known for its wide range of medical devices, diagnostics, branded generic pharmaceuticals, and nutritional products.

Stocks

Shares of ownership in a company, representing a claim on the company's assets and earnings.