Respuesta :
Answer:
I. Volatility in excess returns of the stock market
II. The sensitivity of the stock's returns to changes in the stock market
Both these statements are correct as systematic return is the part of the return which is dependent on the market return, so in this case the volatility in excess returns of the stock market means when the stock markets excess returns are volatile, it will affect the systematic return of the stock. And each stock has a beta which measures the sensitivity of a stocks returns with regards to changes in the markets return, so the beta or the sensitivity is also a variable in determining the stocks systematic return.
Explanation:
