If You Expect the Market to Increase Which of the Following

question 59

Multiple Choice

If you expect the market to increase which of the following portfolios should you purchase?

• A) a portfolio with a beta of 1.9
• B) a portfolio with a beta of 1.0
• C) a portfolio with a beta of 0
• D) a portfolio with a beta of -0.5

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Definitions:

Variance

A statistical measurement of the dispersion of a set of data points, reflecting how much each number in the set differs from the mean.

Governor Cut-out

Governor cut-out is a mechanism in compressors or engines designed to disengage or reduce fuel supply once a predetermined speed or pressure is reached, to prevent over-speeding.

Governor Cut-in

The point at which a governor device starts to regulate or limit the speed, pressure, or other operational parameters to prevent system overloads.

Tractor Protection Valve

A safety device in air-braked vehicles that preserves air for the tractor in case of a trailer brake system failure.