In relation to using historic beta to forecast a firm's future cost of equity, which one...
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In relation to using historic beta to forecast a firm's future cost of equity, which one of the following statements is TRUE? A. The more spread out the data points are when estimating beta using historical returns and linear regression, the more accurate the estimate of beta will be. B. A firm's beta stays constant over time C. If a small number of data points are used when estimating beta using historical returns and linear regression, the estimate of beta will be inaccurate D. When estimating beta using historical returns and linear regression, the historic problem is lessened by going further back in time In relation to using historic beta to forecast a firm's future cost of equity, which one of the following statements is TRUE? A. The more spread out the data points are when estimating beta using historical returns and linear regression, the more accurate the estimate of beta will be. B. A firm's beta stays constant over time C. If a small number of data points are used when estimating beta using historical returns and linear regression, the estimate of beta will be inaccurate D. When estimating beta using historical returns and linear regression, the historic problem is lessened by going further back in time
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Related Book For
Accounting concepts and applications
ISBN: 978-0538745482
11th Edition
Authors: Albrecht Stice, Stice Swain
Posted Date:
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