Suppose You Held a Well-Diversified Portfolio with a Very Large

question 40

Multiple Choice

Suppose you held a well-diversified portfolio with a very large number of securities,and that the single index model holds.If the β of your portfolio was 0.24 and β_Mwas 0.18,the β of the portfolio would be approximately ________.

• A)0.64
• B)1.33
• C)1.25
• D)1.56
• E)none of the above

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Definitions:

Twenty Statements Test

A psychological tool used to measure an individual's self-concept by asking them to complete the sentence "I am..." twenty times in different ways.

Norms of Primary Groups

The norms of primary groups refer to the expected behaviors and rules established within small, close-knit groups such as families or close friends, which significantly influence individual behavior.

Social Networks

Structures made up of individuals or organizations connected by one or more types of interdependency, such as friendship, kinship, common interest, or economic exchange.

Group Cohesion

The bonding together of members of a group, which creates a sense of unity and promotes mutual support among its members.