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O out of The standard deviation of stock is return is 4.3%, the standard deviation of the market return is 3.9% and the corre
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Answer #1

Beta = (standard deviation of stock ÷ standard deviation of market) × correlation coefficient of stock with market

  • Standard deviation of stock = 4.3%
  • Standard deviation of market = 3.9%
  • Correlation coefficient = 0.35
  • Beta = (0.043 ÷ 0.039) × 0.35 = 0.3859
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