In capital asset pricing model, stock with high standard deviation tend to have

The correct answer is: C. high beta.

Beta is a measure of a stock’s volatility relative to the market. A stock with a beta of 1 has the same volatility as the market, while a stock with a beta of 2 is twice as volatile as the market. Stocks with high standard deviations tend to have high betas, meaning that they are more volatile than the market and are therefore more risky.

Here is a brief explanation of each option:

• A. low variation: This is incorrect because stocks with high standard deviations tend to have high variation.
• B. low beta: This is incorrect because stocks with high standard deviations tend to have high betas.
• C. high beta: This is the correct answer because stocks with high standard deviations tend to have high betas.
• D. high variation: This is incorrect because stocks with high standard deviations tend to have high variation.