Which of the Following Statements About Beta Is Correct

question 75

Multiple Choice

Which of the following statements about beta is correct?

• A) If the returns on a stock vary widely, then its standard deviation is large, and as a result, the stock will also have a large beta coefficient.
• B) A stock's standard deviation of returns is a measure of the stock's stand-alone risk, while its beta measures its unsystematic risk.
• C) A portfolio that contains 100 high-beta stocks will not be riskier than a portfolio containing 100 low-beta stocks.
• D) A stock that is perfectly positively correlated with the market would not have a beta coefficient that is greater than one.
• E) A stock with a negative beta has very high firm-specific risk.

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Definitions:

Motor Starters

Devices engineered to control the electrical current for starting and stopping motors to protect them from damage.

Contactor Unit

A contactor unit is an electromechanical switch used for switching an electrical power circuit, similar to a relay but with higher current ratings.

Overload Unit

An overload unit is a device or component in an electric motor or circuit designed to protect against excessive current load that could cause overheating or damage.

MCC Bucket

A modular unit within a motor control center that houses the control and protection devices for a single motor, such as circuit breakers, contactors, and overload relays.