Question: Picture1 is the question, after pic1 there has a solved sample question. I need the answer of a.b.c fill the blank of forms, thx Pic1
Picture1 is the question, after pic1 there has a solved sample question. I need the answer of a.b.c fill the blank of forms, thx
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Consider the following airline industry data from mid-2009; a. Use the estimates in table EE to estimate the debt beta for each firm (use an average if multiple ratings are listed). b. Estimate the asset beta for each firm. c. What is the average asset beta for the industry, based on these firms? a. Use the estimates in table EE to estimate the debt beta for each firm (use an average if multiple ratings are listed). The beta of the debt for each company is: Round to three decimal places.) Market Capitalization (S million 4,981.5 4.883.3 1,209.2 1,136.6 Total Enterprise Value (S million 17,047.9 Debt Ratings Debt Beta Company Name Delta Air Lines (DAL) Southwest Airlines (LUV) JetBlue Airways (JBLU) Continental Airlines (CAL) 6,385.1 3,813.1 4,393.4 Equity Beta 1.913 0.911 1.924 1.987 Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet) Average Debt Betas by Rating and Maturit A and above By ratin Average beta 0.05 0.10 0.17 0.26 0.31 1-5 Yr 0.01 10-15 Yr 0.07 BBB and above By maturity ( Average beta 5-10 Yr 0.06 15 Yr 0.14 Source: S. Schaefer and I. Strebulaev, "Risk in Capital Structure Arbitrage," Stanford GSB working paper, 2009 Print Done Enter vour answer in the edit fields and then click Check Answer parts remaining Clear All Final Check Consider the following airline industry data from mid-2009; a. Use the estimates in table EE to estimate the debt beta for each firm (use an average if multiple ratings are listed). b. Estimate the asset beta for each firm. c. What is the average asset beta for the industry, based on these firms? a. Use the estimates in table EE to estimate the debt beta for each firm (use an average if multiple ratings are listed). The beta of the debt for each company is: Round to three decimal places.) Market Capitalization (S million 4,981.5 4.883.3 1,209.2 1,136.6 Total Enterprise Value (S million 17,047.9 Debt Ratings Debt Beta Company Name Delta Air Lines (DAL) Southwest Airlines (LUV) JetBlue Airways (JBLU) Continental Airlines (CAL) 6,385.1 3,813.1 4,393.4 Equity Beta 1.913 0.911 1.924 1.987 Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet) Average Debt Betas by Rating and Maturit A and above By ratin Average beta 0.05 0.10 0.17 0.26 0.31 1-5 Yr 0.01 10-15 Yr 0.07 BBB and above By maturity ( Average beta 5-10 Yr 0.06 15 Yr 0.14 Source: S. Schaefer and I. Strebulaev, "Risk in Capital Structure Arbitrage," Stanford GSB working paper, 2009 Print Done Enter vour answer in the edit fields and then click Check Answer parts remaining Clear All Final Check
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