Air Canada Stock Has a Standard Deviation of 18%,while the Market

question 94

Multiple Choice

Air Canada stock has a standard deviation of 18%,while the market index standard deviation is 8%.If the correlation between Air Canada and the market index is 0.45,what is the beta of Air Canada stock?

• A)1.01
• B)0.03
• C)0.2
• D)2.25
• E)2.5

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Definitions:

High-risk Project

A project that carries a greater-than-average chance of failing to meet its goals or losing the invested capital due to various uncertainties.

Start-up Firm

A newly established business, often in the early stages of development, focusing on a unique product or service offering in the market.

Market Price

The price in the marketplace at which an asset or service can currently be bought or sold.

Stock Outstanding

The aggregate amount of a corporation's stock currently possessed by all its shareholders, encompassing blocks of shares owned by institutional investors and shares that are subject to restrictions.