A Firm with a Beta of 1

question 74

Multiple Choice

A firm with a beta of 1.0 and when held in a well-diversified portfolio should be considered to have ________ risk than the market portfolio.

• A)less
• B)neither more nor less
• C)more
• D)There is not enough information to answer this question.

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Definitions:

Savings

The part of earnings not used for purchasing goods or services, typically saved for investing or future needs.

Disposable Income

Indicates the sum of funds households can allocate towards expenditure and savings once income taxes have been deducted.

Disposable Income

Households' available economic resources for spending and saving post-tax.

Disposable Income

The amount of money an individual or household has to spend or save after taxes have been deducted.