HW_2_Questions_Chapters_12_13[1]

HW_2_Questions_Chapters_12_13[1] - Homework Chapter 12...

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Homework Chapter 12 Questions 1, 6, 13, 15, 22 Homework Chapter 13 Questions 3, 5, 8, 10
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Multiple Choice 1. In practice, the market portfolio is often represented by: A. a portfolio of U.S. Treasury securities. B. a diversified stock market index. C. an investor's mutual fund portfolio. D. the historic record of stock market returns. 2. When the overall market is up by 10%, an investor with a portfolio of defensive stocks will probably have: A. negative portfolio returns less than 10%. B. negative portfolio returns greater than 10%. C. positive portfolio returns less than 10%. D. positive portfolio returns greater than 10%. 3. If a stock consistently goes down (up) by 1.6% when the market portfolio goes down (up) by 1.2% then its beta: A. equals 1.04. B. equals 1.24. C. equals 1.33. D. equals 1.40. 4. Based on the following information, make an estimate of the stock's beta: Month 1 = Stock +1.5%, Market +1.1%; Month 2 = Stock +2.0%, Market +1.4%; Month 3 = Stock -2.5%, Market -2.0%.
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This note was uploaded on 09/06/2011 for the course FIN 351 taught by Professor Li during the Spring '09 term at S.F. State.

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HW_2_Questions_Chapters_12_13[1] - Homework Chapter 12...

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