Which of the following are more likely equal to the market beta of a real stock?...

Which of the following are more likely equal to the market beta of a real stock?

A) 5

B) -1

C) 1

D) -5

Solutions

Expert Solution

Ans:- Option C is the right answer i.e 1.

Beta tells the volatility of a stock.when the stocks beta is 1 it indicates that the stock price is moving along the market, beta greater than 1 indicates that the stock price is more volatile than the market, and beta less than 1 indicates that it is less volatile than the market.

So, in the options given, the beta which is more likely equal to the market beta would be 1.Therefore, option C is the right answer.

jeff jeffy answered 2 years ago

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