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Within the CAPM equation, a higher BETA can be interpreted as... Note CAPM: rs = rf + Beta(rm - rf) A. high Beta stock: one

Within the CAPM equation, a higher BETA can be interpreted as...

Note CAPM: rs = rf + Beta(rm - rf)

A.

high Beta stock: one would expect a return on the stock investment (rs) to exceed that of the S&P 500; however the riskiness of the stock would not exceed that of the market portfolio

B.

a beta that exceeds "1.3" can be viewed as stock that is riskier than an investment in a diversified portfolio such as the S&P 500

C.

high beta stock: the stock is riskier than the S&P 500, but one would not expect a higher return for such a stock

D.

None of the above

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