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Suppose You Held a Well-Diversified Portfolio with a Very Large

Question 57

Multiple Choice

Suppose you held a well-diversified portfolio with a very large number of securities,and that the single index model holds.If the β of your portfolio was 0.20 and βMwas 0.16,the β of the portfolio would be approximately ________.


A) 0.64
B) 0.80
C) 1.25
D) 1.56
E) none of the above

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