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An Asset in the Australian Market Has a Consumption Beta 0.0010 0.0010

Question 40

Multiple Choice

An asset in the Australian market has a consumption beta of 0.5.If the variance of the asset is 0.024 and the variance of the growth rate in consumption is 0.035,what is the asset's covariance with the growth rate in consumption?


A) 0.0010 0.0010
B) 0.0120 0.0120
C) 0.0175 0.0175
D) 2.0830 2.0830

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