An Asset Has a Standard Deviation of 30% and a Correlation

question 31

Multiple Choice

An asset has a standard deviation of 30% and a correlation with the market portfolio of 0.60.If the market has a standard deviation of 30%,how much lower is the beta of the asset relative to the market?

• A) \( 0.05 \)
• B) \( 0.10 \)
• C) \( 0.18 \)
• D) \( 0.40 \)

---

Definitions:

Interactive Process

A dynamic method involving two or more entities engaging in communication or activities, influencing each other in the process.

Self-Efficacy

An individual's belief in their ability to succeed in specific situations or accomplish a task.

Task Completion

The act of finishing a specific job or assignment, marking the end of the required effort or work.

Motivation

Internal impulse that causes a person to take action.