Suppose You Hold a Portfolio Consisting of a $10,000 Investment

question 72

Multiple Choice

Suppose you hold a portfolio consisting of a $10,000 investment in each of 8 different common stocks.The portfolio's beta is 1.25.Now suppose you decided to sell one of your stocks that has a beta of 1.00 and to use the proceeds to buy a replacement stock with a beta of 1.05.What would the portfolio's new beta be? Do not round your intermediate calculations.

• A) 1.11
• B) 1.26
• C) 1.14
• D) 1.24
• E) 1.41

Understand how participation in management impacts the liability of partners in limited partnerships.

Grasp the concept of pass-through tax entities and how it applies to LLPs.

Understand the rights of partners to access books and information in limited partnerships.

Recognize the implications and conditions under which a partner may lose limited liability status.

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Definitions:

Liability

A legal obligation or responsibility for the consequences of one's actions, potentially resulting in payment or other remedies in a legal context.

Capital

Financial assets or resources that individuals or organizations use to fund their operations and invest in their growth.

Competitors' Organization

A structured group or business that competes in the same industry or market as another business.

Shareholders Approval

A formal consent given by shareholders, typically through voting, for certain actions or decisions proposed by a company's management.