Coefficient of beta is used to measure stock volatility_____________?
Correct answer: B. Relative to market
- A. Coefficient of market
- B. Relative to market
- C. Ir-relative to market
- D. Same with market
Explanation
Beta measures a stock's systematic volatility relative to market movements, with the market beta equal to 1. A beta above 1 indicates greater sensitivity than the market, while a beta below 1 indicates less.
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Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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