You observe the following scatterplot of Ford's weekly returns against the S&P 500. Which of the following statements is true about Ford's beta against the S&P 500?

Question

Quizplus · Accepted Answer

Based on the scatterplot, it appears that Ford's returns move in the same direction as the S&P 500, indicating a positive relationship. This suggests that Ford's beta against the S&P 500 is likely positive. Option B can be ruled out since there is no indication of negative relationship in the scatterplot. Option C can be ruled out because although Ford may have a low beta, it cannot be zero. Option D can also be ruled out since beta measures the systematic risk of an asset compared to the market, and the scatterplot clearly shows the relationship between Ford's returns and the S&P 500.

You Observe the Following Scatterplot of Ford's Weekly Returns Against