The Beta of JCP Stock Has Been Estimated as 1

question 79

Multiple Choice

The beta of JCP stock has been estimated as 1.2 using regression analysis on a sample of historical returns. A commonly-used adjustment technique would provide an adjusted beta of

• A) 1.20.
• B) 1.32.
• C) 1.13.
• D) 1.0.

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Definitions:

Familiar

Well known from long or close association, giving a sense of comfort or recognition.

Systematic Desensitization

A therapeutic technique used to treat phobias and anxiety disorders by gradually exposing the patient to the feared object or situation in a controlled manner.

Relax

To become less tense or anxious, or to make something less taut or firm, often in the context of stress relief or leisure activities.

Imagine

The ability to form new images and sensations in the mind that are not perceived through the five senses.