A Portfolio Consists of Two Stocks and Has a Beta

question 33

Multiple Choice

A portfolio consists of two stocks and has a beta of 1.25.The first stock has a beta of 1.02 and comprises 30 percent of the portfolio.What is the beta of the second stock?

• A) 0.41
• B) 0.66
• C) 0.82
• D) 1.28
• E) 1.35

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Definitions:

Independent Demand Items

Products or services for which demand is influenced by market conditions and customer preferences, not related to the production plans for other items.

Production Schedule

A detailed plan outlining the timing and sequence of production activities necessary to complete a manufacturing process.

MRP II

Stands for Manufacturing Resource Planning, an integrated method of operational and financial planning for manufacturing companies, improving overall production efficiency.

Forecasting

The practice of making predictions about future events or trends based on historical data and analysis, often used in planning and decision-making processes.