Betas Seem to Be More Stable in a Portfolio Context

question 140

True/False

Betas seem to be more stable in a portfolio context (group of stocks)than for individual stocks.

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Definitions:

Rational Consumer

An individual who seeks to maximize their utility or satisfaction from consumption under their budget constraints.

Utility Maximization

A principle in economics that suggests individuals or firms seek to allocate their resources in a way that maximizes their satisfaction or utility.

Marginal Utility

The additional satisfaction or benefit a consumer receives from consuming an additional unit of a good or service.

Demand Curve

is a graphical representation that shows the relationship between the price of a good and the quantity of that good that consumers are willing to purchase.