You Have the Following Data on (1)the Average Annual Returns

question 108

Multiple Choice

You have the following data on (1) the average annual returns of the market for the past 5 years and (2) similar information on Stocks A and B.Which of the possible answers best describes the historical betas for A and B? $$\begin{array} { c r r r } \text { Years } & \text { Market } & \text { Stock A } & \text { Stock B } \\1 & 0.03 & 0.16 & 0.05 \\2 & - 0.05 & 0.20 & 0.05 \\3 & 0.01 & 0.18 & 0.05 \\4 & - 0.10 & 0.25 & 0.05 \\5 & 0.06 & 0.14 & 0.05\end{array}$$

• A) bA > 0;bB = 1.
• B) bA > +1;bB = 0.
• C) bA = 0;bB = -1.
• D) bA < 0;bB = 0.
• E) bA < -1;bB = 1.

Understand the implications of minimum wage regulations on employer practices.

Assess strategies employed by companies to circumvent price and rent controls.

Appreciate the significance of signals in vertical contracts concerning product success expectations.

Understand the implications of vertical and horizontal integration on profitability and competition.

---

Definitions:

Written Conversation

Dialogue or exchange of ideas that occurs through written communication rather than spoken words.

Instant Message

Instant message refers to a real-time communication method through text messages exchanged between users on a computer network.

Acronyms

Shortened forms of words or phrases, made up of initials that are often used to simplify communication.

Formal

Pertaining to a style of communication or appearance that adheres to established conventions, often characterized by professionalism and seriousness.