Answer to Question #20979 in Electric Circuits for Patricia

Question #20979

Which of the following statements is most correct?
A Calculating beta coefficients using a calculator is not a legitimate method of
estimating beta because it measures changes in an individual security’s return
regressed against time.
B The general equation: Y = a + bX + e, is the standard form of a simple linear
regression where b = beta, and X equals the independent return on an individual
security being compared to Y, the return on the market, which is the dependent
variable.
C The beta coefficient used in the SML equation should reflect the expected volatility
of a given share’s return versus the return on the market during some future period.
D The CAPM is an ex ante model, which means that all of the variables should be
historical values that can reasonably be projected into the future.
E All of the above statements are false.

## Comments

## Leave a comment