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Provide assistance calculating the answer to this question. Darby Corporation has is an electric utility has a beta of 0.85. If the government reports strong economic growth of 3%, and,

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Answer #1

The β of any stock is how a stock will move relative to it's given index. For example if β of a stock is 2 and index moves by 3% then the stock will move multiple of β i.e. 3*2 = 6%

So, here index is moved 7% and the β of the stock is 0.85 means the stock will move 0.85 relative to the Index  5.95% i.e. 7%*0.85

Correct option is C.

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