In the green box underneath, please comment on the differences in risk between the two companies as reflected in their respective Required Rates of Return and Weighted-Average costs of Capital. Explain why these are different and how the sectors in which these companies operate affect these differences. Company Name tesla Company Name Amazon Sector & Industry automobiles Sector & Industry online market place Beta 1.72 Beta 1.11 RE 2.93% RE 2.93% 11.44% Equity Risk Premium (= Beta (E(RM) - Rt) 7.46% Equity Risk Premium (-Beta (E(R)-R) Required Rate of Return 14.37% Required Rate of Return 10.39% WEquity 99.40% WEquity 92.80% Whebt 0.60% Woer 7.20% RE 2.9396 RI 2.93% 11.44% 7.46% Equity Risk Premium -Beta (E(R) - RD)) Equity Risk Premium (Beta (E(R) - RF)) Required Rate of Return 14,3796 Required Rate of Return 10.39% WE 99.40% WY 92.8096 Woen 0.60% Webt 2.20% After-tax Cost of Debt 390.00% After-tax Cost of Debt 3.10% WACC 14.30% WACC 909035 3 Directions Beta RR and WACC tady In the green box underneath, please comment on the differences in risk between the two companies as reflected in their respective Required Rates of Return and Weighted-Average costs of Capital. Explain why these are different and how the sectors in which these companies operate affect these differences. Company Name tesla Company Name Amazon Sector & Industry automobiles Sector & Industry online market place Beta 1.72 Beta 1.11 RE 2.93% RE 2.93% 11.44% Equity Risk Premium (= Beta (E(RM) - Rt) 7.46% Equity Risk Premium (-Beta (E(R)-R) Required Rate of Return 14.37% Required Rate of Return 10.39% WEquity 99.40% WEquity 92.80% Whebt 0.60% Woer 7.20% RE 2.9396 RI 2.93% 11.44% 7.46% Equity Risk Premium -Beta (E(R) - RD)) Equity Risk Premium (Beta (E(R) - RF)) Required Rate of Return 14,3796 Required Rate of Return 10.39% WE 99.40% WY 92.8096 Woen 0.60% Webt 2.20% After-tax Cost of Debt 390.00% After-tax Cost of Debt 3.10% WACC 14.30% WACC 909035 3 Directions Beta RR and WACC tady