Question: Using the following information to answer the next three questions Company Average Historical Monthly Return Standard Deviation of Monthly Returns Correlation with the Market Kraft

Using the following information to answer the next three questions Company Average Historical Monthly Return Standard Deviation of Monthly Returns Correlation with the Market Kraft 1.519% 4.55% 0.45 Netflix 8.613% 19.09% 0.12 Deckers 3.151% 13.14% 0.41 Average Monthly Return of the S&P 500 Standard Deviation of the S&P 500 Returns Annual Risk Free Rate Expected Annual Market Return Next Year 1.282% 2.57% 1% 8% 12) What is Decker's Beta over this period? a. 0.49 b. 0.89 c. 1.39 d. 1.79 e. 2.09 13) Using the CAPM model, what is Netflix's required rate of return on equity (cost of equity)? a. b. c. d. e. 6.58% 7.24% 10.47% 12.98% 14.31% 14) Which company has had the least exposure to market (or systematic) risk over this period? a. b. c. d. Kraft Netflix Deckers Not enough information to answer this
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
