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Stock A has a beta of 0 . 8 4 , stock B has a beta of 1 . 4 4 , and stock C

Stock A has a beta of 0.84, stock B has a beta of 1.44, and stock C has a beta of -0.35.
a. Rank these stocks from the most risky to the least risky.
b. If the return on the market portfolio increases by 11.5%, what change in the return for each of the stocks would you expect?
c. If the return on the market portfolio declines by 4.7%, what change in the return for each of the stocks would you expect?
d. If you felt the stock market was about to experience a significant decline, which stock would you be most likely to add to your portfolio? Why?
e. If you anticipated a major stock market rally, which stock would you be most likely to add to your portfolio? Why?
a. Rank these stocks from the most risky to the least risky. (Select from the drop-down menus.)
Stock
Most Risky
Moderately Risky
Least Risky
b. If the return on the market portfolio increases by 11.5%, what change in the return for each of the stocks would you expect?
The impact on asset A's return is
The impact on asset B's return is
The impact on asset C's return is
%.(Round to one decimal place.)
%.(Round to one decimal place.)
%.(Round to one decimal place.)
c. If the return on the market portfolio declines by 4.7%, what change in the return for each of the stocks would you expect?
The impact on asset A's return is
%.(Round to one decimal place.)
The impact on asset B's return is
%.(Round to one decimal place.)
The impact on asset C's return is
%.(Round to one decimal place.)
d. If you felt the stock market was about to experience a significant decline, which stock would you be most likely to add to your portfolio? Why? (Select the best choice below.)
A. Stock A, the defensive stock: While the market declines, the return on A increases.
B. Stock C, the defensive stock: While the market declines, the return on C increases.
C. Stock B, the aggressive stock: As the market declines one point, stock B rises 1.44 points.
D. Stock B, the defensive stock: While the market declines, the return on B increases.
e. If you anticipated a major stock market rally, which stock would you be most likely to add to your portfolio? Why? (Select the best choice below.)
A. Stock B, the aggressive stock: As the market rises one point, Stock B rises 1.44 points.
B. Stock A, the aggressive stock: As the market rises one point, Stock A rises 0.84 points.
C. Stock C, the defensive stock: While the market rises, the return on C increases.
D. Stock C, the aggressive stock: As the market rises one point, Stock C rises 0.35 points.
(1)
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