SCAN Is a Multi-Divisional Utility Company What Is the Firm's Weighted Average Beta?
A) 1

question 48

Multiple Choice

SCAN is a multi-divisional utility company.SCAN has four divisions with the following betas and proportions of the firm's total assets:
$\begin{array}{llc}\frac{\text { Division }}{\text { Electric \& Gas }} & \frac{\text { Beta }}{0.85} & \frac{\% \text { of Assets }}{60} \\\text { Bus transportation } & 0.95 & 10 \\\text { Real estate } & 1.40 & 25 \\\text { Recreation } & 1.15 & 5\end{array}$
What is the firm's weighted average beta?

• A) 1.01
• B) 1.53
• C) 0.93
• D) 1.13

---

Definitions:

Plant Species

A category that ranks below genus and denotes a group of plants that share certain characteristics and are capable of interbreeding to produce fertile offspring.

Endangered Species

Species that are at risk of extinction due to a dramatic decline in their population or habitat.

Flowering Plants

Plants that belong to the group Angiosperms, characterized by bearing flowers in which seeds are enclosed within a fruit.

Mammals

A class of warm-blooded vertebrate animals that possess hair or fur, and whose females produce milk for feeding their young.