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Author Question: Which of the following is NOT a definition of beta? A) A measure of systematic risk B) A measure ... (Read 70 times)

roselinechinyere27m

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on: Jul 10, 2018
Which of the following is NOT a definition of beta?
 
  A) A measure of systematic risk
  B) A measure of risk that can be avoided
  C) A statistical measure of an individual asset's or portfolio's co-movement with the returns of the market
  D) A measure of nondiversifiable risk

Question 2

Joel owns the following portfolio of securities. What is the beta for the portfolio?
 
  Company Beta Percent of Portfolio
  Exxon-Mobil .95 40
  Pacific Industries 1.20 35
  Payson Restaurants 1.35 25
 
  A) 0.9500
  B) 1.0000
  C) 1.1375
  D) 1.1705


ju

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Reply #1 on: Jul 10, 2018
Answer to Question 1

Answer: B
Explanation: B) Beta is a measurement of systematic risk, which cannot be avoided.

Answer to Question 2

Answer: C
Explanation: C) p =  i  wi = .95  40 + 1.20  35 + 1.35  25 = 1.14.


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roselinechinyere27m

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Reply #2 on: Jul 10, 2018
TY


ju

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Reply #3 on: Jul 10, 2018
Happy to Help


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