Consider the Following Equation $\beta$ _option = $\beta$ _S $\beta$ _B
the Term

question 20

Multiple Choice

Consider the following equation: $\beta$ _option = $\beta$ _S + $\beta$ _B
The term $\beta$ _B is

• A) always equal to zero since \(\beta\)_B = 0.
• B) always positive since B is always positive.
• C) could be positive or negative depending on whether the option in question is a put or a call.
• D) always negative since B is always negative.

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Definitions:

Substantial Damage

Significant physical harm or damage to a property or structure, often affecting its value, usability, or function.

Lease Term

The duration for which a lease agreement is valid, typically specifying start and end dates.

Nonfreehold Estates

Interests in real estate that do not involve ownership of the property, typically including leases or rentals.

Real Property

Land and anything permanently attached to it, such as buildings or structures, including the rights associated with ownership.