1. Describe the differences between job order costing and process costing systems. Identify elements of manufacturing cost in each system.
2. You are contemplating investing in a portfolio made up of two stocks, A and B. The beta of Stock A is 1.3, and the beta of Stock B is -1.4. Assume you plan to invest X% in Stock A, and the rest of your capital (that is, 1-X) in Stock B. What should X be so that the beta of the resulting portfolio is zero?