Determine the Covariance, Give That a Company Has a Beta

question 106

Multiple Choice

Determine the covariance, give that a company has a Beta of 1.6 and a variance of 0.6.

• A)0.96
• B)1.16
• C)1.36
• D)1.56

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Definitions:

Profit Centers

Parts of an organization that are responsible for generating revenue and evaluated based on their profitability.

Return on Investment

A performance measure used to evaluate the efficiency or profitability of an investment, calculated as net profit divided by the cost of the investment.

Average Total Assets

A financial metric that represents the average value of all the assets owned by a company over a specific time period.

Operating Expenses

The costs associated with running a day-to-day business operation, excluding the cost of goods sold.