The Average Beta of Individual Stocks in the Market Portfolio

question 34

Multiple Choice

The average Beta of individual stocks in the market portfolio is:

• A)one.
• B)zero.
• C)midway between zero and one.
• D)cannot be calculated without knowing the stocks in the portfolio.

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Definitions:

Belief in a Just World

The assumption that the world is fair and people get what they deserve, influencing one’s response to injustices.

Authoritarianism

A governing system characterized by strong central power and limited political freedoms, often with enforced obedience to authority.

Reciprocity Norm

A social expectation that people will respond to each other in kind, repaying positive actions with positive actions and fostering mutual aid and cooperation.

Rule of Law

The idea that all individuals and organizations are accountable under laws that are impartially applied and enforced.