Question: Prove or disprove, using the formulas for Beta and Correlation, the following statement: A stock with a Beta equal to one is perfectly correlated with

Prove or disprove, using the formulas for Beta and Correlation, the following statement:

"A stock with a Beta equal to one is perfectly correlated with the market"

Hint: to prove a statement is true or false, start with the formulas for each term, set them equal to each other, and see if it reduces down to an identity, that is, if A=A, then the statement is true, if not, it is false.

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