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A Stock Has a Market-Beta of 2

Question 3

Multiple Choice

A stock has a market-beta of 2.65. This means that


A) the stock's returns will vary much more than the returns of the overall stock market.
B) if the general stock market is up 1%, this stock will be down 2.65%.
C) the stock is a less risky investment than an investment in the overall stock market.
D) None of the above is true.

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