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The Coefficient of Determination, R2, Demonstrates That Beta

Question 84

Multiple Choice

The coefficient of determination, R2, demonstrates that beta


A) has a low predictive power when applied to a portfolio of securities.
B) is more effective when evaluating a portfolio rather than an individual security.
C) is relatively unreliable when predicting the return fluctuation of a portfolio.
D) generally explains 75% of the return fluctuation of an individual security.

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