If Equity A's Beta on the Inflation Factor Is 1

question 1

Multiple Choice

If equity A's beta on the inflation factor is 1.2,equity B's is 2.6 and equity C's is 3,a portfolio that has weights of 0.5 on equity A,0.3 on equity B and 0.2 on equity C has a factor beta of _____ on this factor.

• A)1
• B)1.98
• C)6.8
• D)3

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Definitions:

Equal

Describes a state of being the same in quantity, size, degree, or value, often applied to mathematical entities, rights, and opportunities.

Smallpox

A highly contagious viral disease characterized by fever, weakness, and skin eruptions, eradicated by vaccination by 1980.

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The act or reality of sustaining or upholding oneself, particularly at the most basic level.

Domestication

The process by which humans modify the genetic traits of plants and animals to make them more useful and suited for human purposes, often leading to symbiotic relationships.