The Measure of Beta Associates Most Closely With

question 117

Multiple Choice

The measure of beta associates most closely with:

• A) idiosyncratic risk.
• B) risk-free return.
• C) systematic risk.
• D) unexpected risk.
• E) unsystematic risk.

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Definitions:

EPS Growth Rate

A measure of the annualized rate of increase in earnings per share of a company over time.

Rate of Return

The rate of return is the gain or loss on an investment over a specified period, expressed as a percentage of the investment’s cost.

Current Stock Price

The price at which a stock is trading on the public market at any given time.

Market Rate of Return

The average annual return generated from a market or a specific investment over a specific period, often considered a benchmark.