In a Single Factor Market Model the Beta of a Share

question 38

Multiple Choice

In a single factor market model the beta of a share ________.

• A)measures the share's contribution to the standard deviation of the market portfolio
• B)measures the share's unsystematic risk
• C)changes with the variance of the residuals
• D)measures the share's contribution to the standard deviation of the share

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Definitions:

Supply Schedule

Shows how much of a product firms will sell at alternative prices.

Average Fixed Costs

The total fixed costs divided by the quantity of output produced; they decrease as output increases.

Silk Flower Arrangements

Artificial floral displays made from silk or similar synthetic materials, often used as decorations.

Variable Cost

Costs that change in proportion to the level of activity or volume of goods produced in a business.