In the absence of debt, the unlevered beta measures the volatility of the firm's financial return to changes in the general stock market's overall return.

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Quizplus · Accepted Answer

This statement is true. Unlevered beta measures the systematic risk of a company without any debt in its capital structure. It reflects the impact of market movements on the company's assets and operations, which helps investors understand its risk level.

In the Absence of Debt, the Unlevered Beta Measures the Volatility