For each 1% change in the market portfolio's excess return,the investment's excess return is expected to change by ________ percent due to risks that it has in common with the market.

Question

Quizplus · Accepted Answer

The percentage change in the investment's excess return due to risks that it has in common with the market is measured by its beta. Therefore, for each 1% change in the market portfolio's excess return, the investment's excess return is expected to change by its beta percent.

For Each 1% Change in the Market Portfolio's Excess Return,the