An industry is likely to have a low beta if the:
A) stream of revenues is unstable than the market.
B) economy is in an expansion.
C) market for its goods is affected by the market cycle.
D) stream of revenues is more volatile than the market.
E) stream of revenues is stable and less volatile than the market.

Question

Quizplus · Accepted Answer

Beta measures a stock's volatility in relation to the overall market. A low beta indicates that the stock's price movements are less volatile than the market. Therefore, an industry with a stable and less volatile stream of revenues compared to the market will likely have a low beta.

An Industry Is Likely to Have a Low Beta If