The following are beta's for a Microsoft during four time periods. Compare the four estimated betas. What do you conclude about how Microsoft's exposure to systematic risk has changed over that 20-year period? What do you think explains the change? 1987-1991: 1992-1996: 1997-2001: 2002-2006: 1.5882 0.8402 1.7971 1.0335 Which of the following statements is true? (Select the best choice below.) OA. Microsoft's systematic risk decreased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the internet bubble in the late 1990s (when tech stocks were soaring). It has since decreased. OB. Microsoft's systematic risk increased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the internet bubble in the late 1990s (when tech stocks were soaring). It has since decreased. OC. Microsoft's systematic risk decreased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the internet bubble in the late 1990s (when tech stocks were soaring). It has since increased.
The following are beta's for a Microsoft during four time periods. Compare the four estimated betas. What do you conclude about how Microsoft's exposure to systematic risk has changed over that 20-year period? What do you think explains the change? 1987-1991: 1992-1996: 1997-2001: 2002-2006: 1.5882 0.8402 1.7971 1.0335 Which of the following statements is true? (Select the best choice below.) OA. Microsoft's systematic risk decreased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the internet bubble in the late 1990s (when tech stocks were soaring). It has since decreased. OB. Microsoft's systematic risk increased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the internet bubble in the late 1990s (when tech stocks were soaring). It has since decreased. OC. Microsoft's systematic risk decreased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the internet bubble in the late 1990s (when tech stocks were soaring). It has since increased.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:The following are beta's for a Microsoft during four time periods. Compare the four estimated betas. What do you conclude about how Microsoft's exposure to
systematic risk has changed over that 20-year period? What do you think explains the change?
1987-1991:
1992-1996:
1997-2001:
2002-2006:
Which of the following statements is true? (Select the best choice below.)
O A.
Microsoft's systematic risk decreased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the
internet bubble in the late 1990s (when tech stocks were soaring). It has since decreased.
O B.
O C. Microsoft's systematic risk decreased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the
internet bubble in the late 1990s (when tech stocks were soaring). It has since increased.
1.5882
0.8402
1.7971
1.0335
Microsoft's systematic risk increased in the early 1990s as Microsoft established itself as the dominant operating system company, but increased during the
internet bubble in the late 1990s (when tech stocks were soaring). It has since decreased.
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