1 2 Chapter 8 Problem 21 Information regarding Kroger Company, and four industry competitors is shown below, on December 12, 2007. 3 4 5 6 Company Kroger Company Safeway Inc. Supervalu Inc. Whole Foods Markets Winn Dixie Stores Inc. Interest- Bearing Debt $ 6,674.0 5,897.9 8,936.0 760.9 160.1 Equity beta 1.05 0.49 1.17 1.16 2.56 7 Market value equity $ 17,690.8 15,236.3 8,054.3 5,762.1 916.8 8 9 10 11 12 13 a. Estimate the industry asset beta, weighting each company by its proportion of total market value of equity. 14 15 b. Relever the industry asset beta to reflect Kroger's capital structure, and to make another industry-informed) estimate of Kroger's equity beta. 16 17 18 19