Problem $4$

Use the following output of a regression of the monthly returns of stock $x$ against the returns of the S&P

$500$ index to answer the following questions. We regressed $60$ months of returns for stock $x$ against $60$

months of returns for the S&P $500$ index. The output is below:

a$.$ Given the table above, what would be the percentage of the variation in the stock's returns

explained by the market variance or fluctuations?

b$.$ What is the beta of the stock? Would you conclude stock $x$ is a cyclical stock or defensive stock

based on the beta?

c$.$ What is the firm$-$specific standard deviation $($risk$)$ of the stock?