Here are alphas and betas for Est?e Lauder and Caterpillar Tractor for the 60 months ending June
Question:
Here are alphas and betas for Est?e Lauder and Caterpillar Tractor for the 60 months ending June 2017. Alpha is expressed as a percent per month.
Explain how these estimates would be used to calculate an abnormal return.
Transcribed Image Text:
Alpha Beta 0.48 0.70 Estée Lauder -0.41 1.26 Caterpillar Tractor
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 78% (14 reviews)
The estimates are first substituted in the market model Then the re...View the full answer
Answered By
Munir Ahmed Jakhro
I am professional Tutor of of Business Courses, I did my four years Bachelor Degree from one of the Top Business schools of World "Institute of Business Administration" in year 2013. Since then I have been working as Tutor of Accounting, Finance tutor on different online platforms like this website. I am have experience of 6 years teaching business courses to students online and offline my professional job at national savings also helped me in accounting understanding .
4.90+
8+ Reviews
10+ Question Solved
Related Book For
Principles of Corporate Finance
ISBN: 978-1260013900
13th edition
Authors: Richard Brealey, Stewart Myers, Franklin Allen
Question Posted:
Students also viewed these Business questions
-
Here are alphas and betas for Intel and Conagra for the 60 months ending October 2001. Alpha is expressed as a percent per month. Explain how these estimates would be used to calculate an abnormal...
-
Here are alphas and betas for Intel and Conagra for the 60 months ending February 2012. Alpha is expressed as a percent per month. Alpha Beta Intel ................... 0.97 ........... 1.08 ConAgra...
-
Caterpillar Tractor, one of the largest producers of farm machinery in the world, has hired you to advise them on pricing policy. One of the things the company would like to know is how much a 5...
-
In a popular carnival ride called The Centrifuge, shown above, riders stand against the inside wall of a large cylinder, which starts spinning. The radius of the circle traveled by the riders is 4 ....
-
Paul, Kenyatta, and Rosanna each took one national language exam. Paul took the French exam and scored 88. Kenyatta took the Spanish exam and scored 84. Rosanna took the Mandarin exam and scored 91....
-
A summarised balance sheet for Roche Ltd at 31 August 2019 was as follows: The following transactions occurred during September: a. Paid $100 000 of accounts payable. b. Received $300 000 from...
-
What is the purpose of timelines in an investigation?
-
In eight years, Kent Duncan will retire. He is exploring the possibility of opening a self-service car wash. The car wash could be managed in the free time he has available from his regular...
-
1. Prove: 1 + 2 + 3 + - + n = (n + 1) using lattice paths. 1+2+3++n= n+ 2 2. Solve a = 2n+1 - 1 with a = 1.
-
Four key organizational complements must be in place to ensure successful implementation and use of a new system. Which two of these components seem to be missing at your store?
-
The second column in Table 13.1 shows the monthly return on the British FTSE 100 index from January 2015 through July 2017. The remaining columns show returns on the stocks of two firms?Executive...
-
True or false? a. Banks are huge investors in corporate equity. b. Insurance companies are huge investors in corporate debt. c. Rather than investing directly in corporate equities, most households...
-
Yu Amy Xia has developed a specialized airtight vacuum bag to extend the freshness of seafood shipped to restaurants. She has put together the following demand cost data: Yu decides that the initial...
-
Managers are increasingly seeing the benefits of emerging countries as the next frontier for potential future growth prospects as mature markets become more saturated. As these markets are...
-
Information & education instruments aim to correct market failures ... Points: 1 Related to the information gap that exists and which prevents individuals from making environmentally informed choices...
-
What differences might you expect to find in the corporate cultures of a 100-year-old manufacturing firm based in Winnipeg and a 5-year-old e-commerce firm based in Ottawa?
-
Which modality interests you? Why does it interest you? What kind of patient conditions and disease processes are referred to your imaging modality? What are the educational, training & licensure...
-
What would happen if you had no disposable income? Explain
-
Refer to Data Set 17 "Course Evaluations" in Appendix B. a. Use the 93 course evaluations to construct a 95% confidence interval estimate of the standard deviation of the population from which the...
-
Determine the volume of the parallelepiped of Fig. 3.25 when (a) P = 4i 3j + 2k, Q = 2i 5j + k, and S = 7i + j k, (b) P = 5i j + 6k, Q = 2i + 3j + k, and S = 3i 2j + 4k. P
-
Seashore Salt Co. has surplus cash. Its CFO decides to pay back $4 per share to investors by initiating a regular dividend of $1 per quarter or $4 per year. The stock price jumps to $90 when the...
-
Look again at Problem 3. Assume instead that the CFO announces a stock repurchase of $4 per share instead of a cash dividend. a. What happens to the stock price when the repurchase is announced?...
-
Go back to the first Rational Demiconductor balance sheet. Now assume that Rational wins a lawsuit and is paid $1 million in cash. Its market capitalization rises by that amount. It decides to pay...
-
Assume that the Incentive Pool in Halifax Hospital only included revenues with respect to the professional component of the oncology services. Would the court have reached a different conclusion?...
-
Bob is a sales clerk at a retail clothes store. When he locks the store for the evening at closing time, he is unaware that a customer is in the change room. The customer is unable to call anyone and...
-
Discuss your experience of learning about your classmates and how it impacted your understanding of people from other backgrounds. In your second post, reflect on what you learned in this course and...
Study smarter with the SolutionInn App