Assume the betas for securities A, B, and C are as shown here: °. a. Calculate the change in return for each security if the market experiences an increase in its rate of return of 12.3% over the next period. b. Calculate the change in return for each security if the market experiences a decrease in its rate of return of 9.2% over the next period. c. Rank and discuss the relative risk of each security on the basis of your findings. Which security might perform best during an economic downturn? Explain. Review Only Click the icon to see the Worked Solution. a. Calculate the change in return for each security if the market experiences an increase in its rate of returm of 12.3% over the next period. Security A's change in return will be %. (Round to two decimal places.) Security B's change in return will be %. (Round to two decimal places.) Security C's change in return will be %. (Round to two decimal places.) b. Calculate the change in return for each security if the market experiences a decrease in its rate of returm of 9.2% over the next period. Security A's change in return will be %. (Round to two decimal places.) Security B's change in retun will be %. (Round to two decimal places.) Security C's change in return will be %. (Round to two decimal places.) c. Rank and discuss the relative risk of each security on the basis of your findings. Which security might perform best during an economic downturn? Explain. (Selec the best choice below.) O A. Security A is the most risky. It has the highest relevant risk, as determined by the beta values and the greater changes in security A's return for a given change in the market return. O B. Security C could be called defensive since it moves in the opposite direction from the market (its return increased when the market return fell and vice versa). OC. During an economic downturn, it can probably be assumed that the market return would decrease. If this occurred, security C would perform best. Otherwise, security B would be best since it would be least responsive to a change in the market return. O D. Security B is the least risky since its return is least responsive (regardless of direction) to changes in the market return. O E. All the above statements are correct. 6: Data Table (Click on the icon here in order to copy its contents of the data table below into a spreadsheet.) Security Beta A 1.59 B 0.64 - 0.24