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Suppose the Following Equation Best Describes the Evolution Of β\beta Over Time

Question 31

Multiple Choice

Suppose the following equation best describes the evolution of β\beta over time: β\beta t = 0.25 + 0.75 β\beta t - 1.
If a stock had a β\beta of 0.6 last year, you would forecast the β\beta to be _______ in the coming year.


A) 0.45
B) 0.60
C) 0.70
D) 0.75

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