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Suppose the Following Equation Best Describes the Evolution of β

Question 50

Multiple Choice

Suppose the following equation best describes the evolution of β over time:
Βt= 0.25 + 0.75βt-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) 0.70
D) 0.75
E) none of the above

Correct Answer:

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