Which of the Following Is NOT a Correct Statement of Beta

question 42

Multiple Choice

Which of the following is NOT a correct statement of beta?

• A) It is a measure of market risk.
• B) It measures the risk of an individual stock or portfolio relative to the market portfolio.
• C) It is the slope of the capital market line.
• D) It changes through time as the risk of the underlying security or portfolio changes.

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Definitions:

Peanut Butter

A food paste or spread made from ground, dry-roasted peanuts, often used as a sandwich filling or ingredient in various recipes.

Income Elasticity

Measures how the quantity demanded of a good responds to a change in consumer income.

Normal Good

An item for which demand increases as the income of consumers increases, showing a direct relationship between income and demand.

Income Elasticity

A measure of how much the demand for a good changes as the income of consumers changes.