If a Stock's Beta Is 0

question 11

Multiple Choice

If a stock's beta is 0.8 during a period when the market portfolio was down by 10%,then,a priori,we could expect this individual stock to:

• A) lose more than 10%.
• B) lose, but less than 10%.
• C) gain more than 10%.
• D) gain, but less than 10%.

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Definitions:

Observer-Expectancy Effect

refers to a cognitive bias wherein a researcher's expectations influence the participants of an experiment, potentially affecting the outcome.

Mental Age

A measure of an individual's cognitive ability compared to the average cognitive ability of an individual of a specific chronological age.

Intelligence Quotient

A numerical measure of a person's cognitive abilities in relation to their age group, often assessed through standardized tests.

Chronological Age

The measure of an individual's age in years, months, and days, from their date of birth to the current date.