Question: Stock A has a beta = 0 . 8 , while Stock B has a beta = 1 . 6 . Which of the following
Stock A has a beta while Stock has a beta Which of the following statements is CORRECT?
If the marginal investor becomes more risk averse, the required return on Stock B will increase by more than the required return on Stock
An equally weighted portfolio of Stocks A and B will have a beta lower than
Stock Bs required return is double that of Stock As
If the marginal investor becomes more risk averse, the required return on Stock A will increase by more than the required return on Stock B
If the riskfree rate increases but the market risk premium remains constant, the required return on Stock A will increase by more than that on Stock B
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