The Historical Nominal Returns for Stock a Were -8%,+10%,and +22

question 30

Multiple Choice

The historical nominal returns for stock A were -8%,+10%,and +22%.The nominal returns for the market portfolio were +6%,+18%,and 24% during this same time.Calculate the beta for stock

• A)1.64
• B)0.61
• C)1.00
• D)0.50

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Definitions:

Marginal Benefit

Marginal benefit is the additional satisfaction or value a consumer derives from consuming one more unit of a good or service.

Inadequate Information

A situation where the available data is insufficient or missing, leading to uncertainty in decision-making or analysis.

Government Intervention

Actions taken by a government to influence or regulate economic activities, which can include regulations, subsidies, tariffs, and taxes.

Market Failure

A situation where free markets fail to allocate resources efficiently, leading to a loss of economic and social welfare.