systematic; unsystematic |
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unsystematic; systematic |
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total; unsystematic |
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total; systematic |
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asset-specific; market |
Standard deviation measures _____ risk while beta measures _____ risk. systematic; unsystematic unsystematic; systematic total; unsystematic...
Which of the following is statements is TRUE? Beta is a measure of unsystematic risk ) A beta of 1 implies the asset has the same unsystematic risk as the overall market. A beta > 1 implies the asset has more systematic risk than the overall market. A beta < 1 implies the asset has more systematic risk than the overall market.
Which of the following statements about risk measures is correct? a. Beta is a measure of systematic risk, whereas standard deviation is the measure of total risk. b. Beta is a measure of total risk, whereas standard deviation is the measure of unsystematic risk. c. Beta is a measure of total risk, whereas standard deviation is the measure of systematic risk. d. Beta is a measure of total risk, whereas Standard deviation is the measure of systematic risk. e. Beta...
Question 12 What does the beta measure? systematic risk diversifiable risk. company-specific risk. unsystematic risk.
12. Decompose the Total Return on the systematic and unsystematic portions of the following asset: Expected Return market = 4% Risk Free - 1% Expected Return asset A-7% Actual Return Market = 2% Beta asset A .89 Actual Return asset A 5 % UNE (RM) = RM-E(R) UNE (RA) = RA-E(R) Systematic Portion of UNE Return = (Ry - ERBA Unsystematic Portion of UNE Return = (RA-E(R)) - (RM-E(R))BA Interpret your results
The scroll down options are 1. systematic/unsystematic risk 2. systematic/unsystematic risk 3. standard deviation/risk aversion 4. correlation coefficient/diversification Risk is the potential for an investment to generate more than one return. A security that will produce only one known return is referred to as a risk- free asset, as there is no potential for deviation from the known expected outcome. Investments that have the chance of producing more than one possible outcome are called risky assets. Risk, or potential variability...
What kind of risk is a strike by employees? total market unsystematic systematic economic
Which risk will be priced? A. Total risk B. systematic C. unsystematic risk?
S13-26 Systematic versus Unsystematic Risk (LO3] Consider the following information about Stocks I and II: Rate of Return If State Occurs Probability of State of Economy .15 Stock Stock 11 --23 State of Economy Recession Normal Irrational exuberance .03 .20 .70 .09 .15 .08 .43 The market risk premium is 7 percent, and the risk-free rate is 3.5 percent. (Round your answers to 2 decimal places, e.g., 32.16.) The standard deviation on Stock I's return is deviation on Stock Il's...
Which type of risk is not accounted for while calculating expected returns? ille Beta risk undiversifiable market systematic unsystematic
Problem 13-26 Systematic versus Unsystematic Risk [LO3] Consider the following information about Stocks I and I Rate of Return If State Occurs State of Probability of State of Stock II Economy Stock I Economy 28 Recession 05 -20 Normal 53 17 07 Irrational 19 06 40 exuberance The market risk premium is 8 percent, and the risk-free rate is 2 percent. (Do not round intermediate calculations. Round your answers to 2 decimal places, e.g., 32.16. Enter your return answers as...