The Annual Returns for Three Years for Stock B Were

question 45

Multiple Choice

The annual returns for three years for stock B were 0%,10%,and 26%.Annual returns for three years for the market portfolio were +6%,18%,and 24%.Calculate the beta for the stock.

• A)0.75
• B)1.36
• C)1.00
• D)0.74

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Definitions:

Investment Publication

A document or report providing analysis, news, and insights on investments, markets, and financial strategies.

Beta

A measure of a stock's volatility in relation to the overall market, indicating the risk associated with the security.

Capital Structure Weight

Capital structure weight refers to the proportion of each type of capital (debt, equity, etc.) in the total capital of a company, often used in calculating the weighted average cost of capital (WACC).

Convertible Bonds

A type of bond that can be converted into a predetermined number of shares of the issuing company's stock at certain times during the bond's life, usually at the discretion of the bondholder.