You Have the Following Data on (1) the Average Annual $b_{\mathrm{A}}>0 ; b_{\mathrm{B}}=1$

question 5

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?

• A) \( b_{\mathrm{A}}>0 ; b_{\mathrm{B}}=1 \).
• B) \( b_{A}>+1 ; b_{B}=0 \).
• C) \( \mathrm{b}_{\mathrm{A}}=0 ; \mathrm{b}_{\mathrm{B}}=-1 \).
• D) \( \mathrm{b}_{\mathrm{A}}<0 ; \mathrm{b}_{\mathrm{B}}=0 \).
• E) \( b_{\mathrm{A}}<-1 ; b_{B}=1 \).

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Definitions:

Stepwise Mechanism

A reaction mechanism that occurs through multiple discrete stages, each involving its own transition state and intermediates.

HBr

Hydrobromic acid, a diatomic molecule formed by hydrogen and bromine, used in synthesis and as a strong acid in aqueous solutions.

Major Organic Product

The primary product resulting from a chemical reaction, often emphasized in organic chemistry due to its greater yield or significance.

Reaction

The procedure in which substances, known as reactants, are chemically changed to produce one or more different substances, the products.