Question: Please answer a,b,c,d questions with the formula please. 10.6 Suppose that Apex Health Services has four different projects. invested and estimated corporate and market betas:
10.6 Suppose that Apex Health Services has four different projects. invested and estimated corporate and market betas: These projects are listed below, along with the amount of capital Project Walk-in clinic MRI facility Clinical laboratory X-ray laboratory Amount Invested $ 500,000 2,000,000 1,500,000 1,000,000 $5,000,000 Corporate Beta Market Beta 1.5 1.1 1.2 1.5 0.9 0.8 0.5 1.0 a. Why do the corporate and market betas differ for the same project? b. What is the overall corporate beta of Apex Health Services? Is the calculated beta consistent with corporate risk theory? c. What is the overall market beta of Apex Health Services? d. How does the riskiness of Apex's stock compare with the riskiness of an average stock? e. Would stock investors require a rate of return on Apex that is greater than, less than, or the same as the return on an average risk stock? funtoms (CHS) is evaluating the
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
