The Average of the Betas for All Stocks Is

question 82

Multiple Choice

The average of the betas for all stocks is:

• A) greater than 1.0; most stocks are aggressive.
• B) less than 1.0; most stocks are defensive.
• C) unknown; betas are continually changing.
• D) exactly 1.0; these stocks represent the market.

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Definitions:

Outside Customers

Individuals or entities that purchase a company's products or services but are not part of the company itself.

Maintenance Department

A segment within a company responsible for the upkeep and repair of equipment, ensuring that operations run smoothly and efficiently.

Variable Costs

Costs that vary directly with the level of production or sales, such as materials and labor.

Fixed Costs

Expenses that do not change with the volume of production or sales, such as rent, salaries, and insurance.