You Have the Following Data on (1)the Average Annual Returns

Multiple Choice

You have the following data on (1) the average annual returns of the market for the past 5 years and (2) similar information on Stocks A and B.Which of the possible answers best describes the historical betas for A and B? $$\begin{array} { c r r r } \text { Years } & \text { Market } & \text { Stock A } & \text { Stock B } \\1 & 0.03 & 0.16 & 0.05 \\2 & - 0.05 & 0.20 & 0.05 \\3 & 0.01 & 0.18 & 0.05 \\4 & - 0.10 & 0.25 & 0.05 \\5 & 0.06 & 0.14 & 0.05\end{array}$$

A) bA > 0;bB = 1.
B) bA > +1;bB = 0.
C) bA = 0;bB = -1.
D) bA < 0;bB = 0.
E) bA < -1;bB = 1.