Question: Answer the question based on the following regression charts. The first chart shows the results of a regression of Tesla (TSLA) stock returns on the

Answer the question based on the following regression charts. The first chart shows the results of a regression of Tesla (TSLA) stock returns on the S&P 500 index returns. The second chart is the same for Microsoft (MSFT) returns. The respective regression equation and R-squared are in the upper right corner of each chart.

Given the regression results, which stock is riskier when held in a well-diversified portfolio?

Group of answer choices

Both stocks increase in risk when held in a well-diversified portfolio.

Tesla (TSLA)

Neither stock should be held in a well-diversified portfolio.

Microsoft (MSFT)

2.

Answer the question based on the following regression charts. The first chart shows the results of a regression of Tesla (TSLA) stock returns on the S&P 500 index returns. The second chart is the same for Microsoft (MSFT) returns. The respective regression equation and R-squared are in the upper right corner of each chart.

Given the regression results, which stock has more firm-specific risk?

Group of answer choices

They both have equal amounts of firm-specific risk.

Tesla (TSLA)

Microsoft (MSFT)

Firm-specific risk? Whats firm-specific risk?

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