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Suppose the Following Equation Best Describes the Evolution of β

Question 28

Multiple Choice

Suppose the following equation best describes the evolution of β over time:βt = 0.36 + 0.85βt − 1.If a stock had a β of 0.6 last year, you would forecast the β to be _______ in the coming year.


A) 0.45
B) 0.60
C) 0.87
D) 0.75

Correct Answer:

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