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    Characteristic(s) line, regression lines and more...

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    4. Which of the following statements is correct?

    a. The characteristics line is the regression line that results from plotting the returns on a particular stock versus the returns on a stock from a different industry.

    b. The distance of the plot points from the characteristics line is a measure of the stock's discounted value risk.

    c. "Characteristics line" is another name for the Security Market Line.

    d. The distance of the plot points from the characteristics line is a measure of the stock's market risk.

    e. The slope of the characteristic line is the stock's standard deviation.

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    The expert examines characteristics lines for regression.

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