$1.$ Using information found in the attached excel file, how does the risk of Stock D compare to the risk of the Market?

a$.$ Stock D is twice as risky as the market, denoted by a calculated Beta of $2\mathrm{.}0,$ which is twice as risky as the market beta of $1\mathrm{.}0$

b$.$ Stock D is a perfect hedge against market risk, denoted by a calculated Beta of $-1\mathrm{.}0$; This stock will rise $1$ when the market falls $1.$

c$.$ Stock D carries the same risk as the market; Both stock B and the market have a beta of $1\mathrm{.}0$

d$.$ None of the above

e$.$ Stock D is half as risky as the market, denoted by a calculated Beta of $0\mathrm{.}5,$ which is half as risky as the market beta of $1\mathrm{.}0$

$2.$ The Beta of the portfolio is:

$3.$ Calculate the volatility $($standard deviation$)$ of Portfolio.

$4.$ If an investor wishes to minimize volatility, the investor should

a$.$ Hold a diversified portfolio of $500$ stocks or more

b$.$ Hold a single stock

c$.$ Increase holdings from a single stock to a portfolio of $5$ stocks

d$.$ It is not possible to reduce volatility $-$ stocks are inherently volatile

e$.$ none of the above