Question
XYX Corp. has a beta coefficient of 1.2. Which of the following statements is correct? a. The returns for XYZ common stock are expected to
XYX Corp. has a beta coefficient of 1.2. Which of the following statements is correct?
a. The returns for XYZ common stock are expected to be 1.2 times as volatile than the returns for the overall stock market
b. The returns for XYZ common stock are expected to be 0.2 times as volatile as the returns for the overall stock market
c. The expected return for XYZ common stock is expected to be 1.2 times greater than the expected return for the overall stock market
d. The standard deviation of returns for XYZ Corp. common stock must be greater than the standard deviation of returns for other similar stocks in the same industry.
e. more than one of the above statements is true
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