Question
1. You are calculating the risk of ABC stock in relation to the market index and you find ABCs beta is 2.25, the market indexs
1. You are calculating the risk of ABC stock in relation to the market index and you find ABCs beta is 2.25, the market indexs standard deviation is 22%, and the standard deviation of ABCs residual error terms is 40%.What percentage of ABCs total variance is due to systematic risk? Enter your answer rounded to two decimal places.
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Financial Management Core Concepts
Authors: Raymond Brooks
4th Edition
134730417, 134730410, 978-0134730417
