49. Stock Price Volatility. The term “beta” refers to a measure of a stock's price volatil-
ity relative to the stock market as a whole. A beta of 1 means the stock's price moves
exactly with the market. A beta of 1.6 means the stock's price would increase by 1.6%
for an increase of 1% in the stock market. A larger beta means the stock price is more
volatile. The beta values for the stocks of the companies that make up the Dow Jones
Industrial
a. Construct a frequency distribution and percent frequency distribution.
b. Construct a histogram.
Betas for Dow Jones Industrial Average Companies
Company
Beta
Company
Beta
American Express Company
1.24
3M Company
1.23
The Boeing Company
.99
Merck & Co. Inc.
.56
Caterpillar Inc.
1.2
Microsoft Corporation
.69
Cisco Systems, Inc.
1.36
Nike, Inc.
.47
Chevron Corporation
1.11
Pfizer Inc.
.72
Dow, Inc.
1.36
The Procter & Gamble Company
.73
The Walt Disney Company
.97
AT&T, Inc.
.18
The Goldman Sachs Group, Inc.
1.79
The Travelers Companies, Inc.
.86
The Home Depot, Inc.
1.22
UnitedHealth Group Incorporated
.88
International Business Machines Corporation
.92
United Technologies Corporation
1.22
Intel Corporation
.9
Visa Inc.
.82
Johnson & Johnson
.84
Verizon Communications Inc.
.04
JPMorgan Chase & Co.
1.84
Walgreens Boots Alliance
.81
The Coca-Cola Company
.68
Walmart Stores Inc.
.26
McDonald's Corp.
.62
Exxon Mobil Corporation
1.1

c. Comment on the shape of the distribution.
d. Which stock has the highest beta? Which has the lowest beta?