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Rufina [12.5K]
3 years ago
14

The standard deviation of the market-index portfolio is 20%. Stock A has a beta of 2.00 and a residual standard deviation of 30%

.
a. Calculate the total variance for an increase of 0.10 in its beta. (Do not round intermediate calculations. Round your answer to the nearest whole number.)
b. Calculate the total variance for an increase of 2.62% in its residual standard deviation?

Business
1 answer:
denpristay [2]3 years ago
5 0

Answer:

a). 0.2664 or 26.6400%

b). 0.266406 or 26.6406%

Explanation:

calculation and full explanation is in the attached picture below

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Answer:

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