Which of the Following Is True Regarding the Beta Coefficient

question 386

Multiple Choice

Which of the following is true regarding the beta coefficient?

• A) It is a measure of unsystematic risk.
• B) A beta greater than one represents lower systematic risk than the market.
• C) Generally speaking, the higher the beta the higher the expected return.
• D) A beta of one indicates an asset is totally risk-free.
• E) The risk premium of an asset will increase if the beta of that asset decreases.

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Definitions:

Transportation Systems

The infrastructure, modes, and policies involved in the movement of goods and people from one location to another.

Uncertainty In Demand

Uncertainty in demand refers to the unpredictable fluctuations in customer demand for goods or services, making inventory and production planning challenging.

Inflexible Transportation Modes

Transportation methods that offer limited flexibility in operations, schedules, or routes, often leading to challenges in adapting to changing supply chain needs.

Expensive

Having a high price or cost; signifying that a good or service costs a lot, often more than what is considered reasonable or affordable.