The Beta of a Stock

question 82

Multiple Choice

The beta of a stock:

• A)measures its risk on a stand-alone basis.
• B)measures its risk in a well-diversified portfolio.
• C)is based on the historical relationship between the performance of that stock and the performance of the market.
• D)Both a. and b. are correct.
• E)Both b. and c. are correct.

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Definitions:

Optimism

The tendency to maintain a positive outlook, expecting the best possible outcome in any given situation.

Negative Organizational News

Information communicated by an organization that may be perceived as unfavorable, disappointing, or detrimental by its stakeholders.

Disappointment

The feeling of dissatisfaction that arises when expectations or wishes are not met.

Effective Negative Message

Communication that conveys disappointing, undesirable, or unfavorable information in a manner that minimizes backlash and maintains the relationship.