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Use the information in the following table to answer the questions in this self-test: Standard deviation Beta Stock J 30% 0.6 Stock K 10% 1.2

Use the information in the following table to answer the questions in this self-test:

Standard deviation

Beta

Stock J

30%

0.6

Stock K

10%

1.2

1.Which stock is the riskiest when held alone?

2.Which stock adds the most risk to a portfolio?

3.Which stock will have the higher risk premium in the market?

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