8. Look up the beta coefficients for two companies you are interested in and report them....
8. Look up the beta coefficients for two companies you are interested in and report them. According to the beta coefficients, which company is considered to have more market risk?
Homework Answers
Two companies I looked out for are Ford motor company and Arcelor mittal (a mining company).
The beta for the stocks as on november 22:
| Ford motor company | 1.10 |
| Arcelor mittal | 2.42 |
| (source: marketbeat) |
Beta is the measure of responsiveness of a stock to changes in market.
The higher the beta the higher is the perceived risk.
Of the two companies Arcelor mittal has more market risk.
Add Answer to:
8.
Look
up the beta coefficients
for
two companies you are interested in and
report them....
Problem 8-08 Two stocks, A and B, have beta coefficients of 0.9 and 1.4, respectively. If...
Problem 8-08 Two stocks, A and B, have beta coefficients of 0.9 and 1.4, respectively. If the expected return on the market is 14 percent and the risk-free rate is 6 percent, what is the risk premium associated with each stock? Round your answers to two decimal places. The risk premium for stock A: % The risk premium for stock B: %
Problem 8-08 Two stocks, A and B, have beta coefficients of 0.8 and 0.6, respectively. If...
Problem 8-08 Two stocks, A and B, have beta coefficients of 0.8 and 0.6, respectively. If the expected return on the market is 14 percent and the risk-free rate is 5 percent, what is the risk premium associated with each stock? Round your answers to two decimal places. The risk premium for stock A: The risk premium for stock B:
Consider two companies: United States steel (X) and Facebook (FB). Look at the profiles (financial statements...
Consider two companies: United States steel (X) and Facebook (FB). Look at the profiles (financial statements for 2016) of each on yahoo finance and discuss the followings (you need to calculate these values yourself and show details of your calculations): How many outstanding shares the company has? What is the market value of the company? What is the book value of the company? What is the beta for the company? How do you find the risk free rate? (consider the...
Two stocks, A and B, have beta coefficients of 0.8 and 1.4, respectively. If the expected...
Two stocks, A and B, have beta coefficients of 0.8 and 1.4, respectively. If the expected return on the market is 10 percent and the risk-free rate is 5 percent, what is the risk premium associated with each stock?
You are forecasting the returns for PVC Company, a plumbing supply company, which pays a current dividend of $10. The dividend is expected to grow at a rate of 3 percent. You have identified two public companies, ABC and VJK, which appear to be comparable
You are forecasting the returns for PVC Company, a plumbing supply company, which pays a current dividend of $10. The dividend is expected to grow at a rate of 3 percent. You have identified two public companies, ABC and VJK, which appear to be comparable to PVC. ABC has the same total risk as PVC and a beta of 1.2. VJK, in contrast, has a very different total risk but the same market risk as PVC. VJK’s beta is 0.75....
1,2. On Yahoo! Finance, look up two stock’s betas. McDonald’s: 4.9 Apple: 1.29 3.4. If the...
1,2. On Yahoo! Finance, look up two stock’s betas. McDonald’s: 4.9 Apple: 1.29 3.4. If the expected market return is 10% and the risk-free rate is 1%, what are the expected returns of the two stocks in 1 and 2 above? 5. If the expected market return is 11% and the risk-free rate is 2.50%, what is the expected return of a stock with a beta of -0.1?
7. Here are data on two companies. The T-bill rate is 4% and the market risk...
7. Here are data on two companies. The T-bill rate is 4% and the market risk premium is 6%. Company Forecasted return Standard deviation of returns $1 Discount Store Everything $5 12% 11% 8% 10% 1.5 1.0 Beta a. What would be the fair return for each company, according to the capital asset pricing model (CAPM)? b. Characterize each company in the previous problem as underpriced, overpriced, or properly priced.
More and more companies have specific workplace diversity policies. Think about two companies for whom you...
More and more companies have specific workplace diversity policies. Think about two companies for whom you may want to work. Look up their websites and see if you can find information on their diversity policies. Compare the policies. What do they have in common? What are some of the differences that you discovered? Summarize and post your findings
Look up a public company. Search through the latest report for that company and see if...
Look up a public company. Search through the latest report for that company and see if you can identify a corporate social responsibility initiative OR search through the financial statements and identify total assets, total liabilities, total revenue, and total expenses. Report on what you have found by creating a WORD document. Upload your document to the dropbox. Explain why you chose this company. Why would this document be useful to stakeholders
A quality control inspector is interested in comparing two concreting companies with respect to overall quality...
A quality control inspector is interested in comparing two concreting companies with respect to overall quality of their work. One measure of quality is whether or not the concrete that has been poured is at least 15 centimeters (cm) thick. The inspector has recorded details for jobs from both companies and is now interested in whether the companies differ with respect to this measure of quality. Let p1 denote the true proportion of times that Company 1 will fail to...
Problem 8-08 Two stocks, A and B, have beta coefficients of 0.8 and 0.6, respectively. If the expected return on the market is 14 percent and the risk-free rate is 5 percent, what is the risk premium associated with each stock? Round your answers to two decimal places. The risk premium for stock A: The risk premium for stock B:
7. Here are data on two companies. The T-bill rate is 4% and the market risk premium is 6%. Company Forecasted return Standard deviation of returns $1 Discount Store Everything $5 12% 11% 8% 10% 1.5 1.0 Beta a. What would be the fair return for each company, according to the capital asset pricing model (CAPM)? b. Characterize each company in the previous problem as underpriced, overpriced, or properly priced.
Look up a public company. Search through the latest report for that company and see if you can identify a corporate social responsibility initiative OR search through the financial statements and identify total assets, total liabilities, total revenue, and total expenses. Report on what you have found by creating a WORD document. Upload your document to the dropbox. Explain why you chose this company. Why would this document be useful to stakeholders
Most questions answered within 3 hours.
-
High End Costume is all-equity financed and its stock has a
price to earnings ratio of...
asked 9 minutes ago -
A block of 2 kg of mass is attached to a horizontal spring. The
spring is...
asked 20 minutes ago -
How are thermohaline currents tied to the atmosphere and how can
these currents affect climate variations...
asked 27 minutes ago -
One 2.5 MW turbine had a monthly production of 700 MWh, while
the 250 MW wind...
asked 35 minutes ago -
C++ question.
Introduce a pass by pointer function that reverses a whole
vector.
asked 32 minutes ago -
The number of head trauma injuries at a small hospital has a
Poisson distribution with a...
asked 36 minutes ago -
1. An airplane leaves airport A and travels in a straight line
in a direction 30...
asked 51 minutes ago -
Consider a chess tournament in which you play one game with each
of 3 opponents, but...
asked 51 minutes ago -
There's sometimes a stereotype that in marriage the husband is
often older than the wife. The...
asked 1 hour ago -
convert the following
138,000 J/mol to m^2/s
1.05 x 10^-5 m^2/s to kJ/ mol
asked 1 hour ago -
Calculate the weight of H2SO4 in 25 mL of concentrated acid that
has a specific gravity...
asked 1 hour ago -
An object is located 7.10 cm in front of a mirror. The virtual
image is located...
asked 4 hours ago