You Are Given the Following Returns on "The Market" and Stock

Multiple Choice

You are given the following returns on "the market" and Stock Q during the last three years. We could calculate beta using data for Years 1 and 2 and then, after Year 3, calculate a new beta for Years 2 and 3. How different are those two betas, i.e., what's the value of beta 2 - beta 1? (Hint: You can find betas using the Rise-Over-Run method, or using your calculator's regression function.)

A) 7.89
B) 8.30
C) 8.74
D) 9.20
E) 9.66