You have been provided with the following data regarding Telebank Ltd's returns and the corresponding market...
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You have been provided with the following data regarding Telebank Ltd's returns and the corresponding market returns from 2002 to 2009: Year 2002 2003 2004 2005 2006 2007 2008 2009 Required: Return on Telebank Ltd. Return on the market 12% 14% 8% 16% 14% 10% 18% 20% 20% 26% 24% 28% 26% 18% 20% 24% (i) Calculate the standard deviations of Telebank Ltd's returns and the market returns. (4 marks) (ii) Determine the beta of Telebank Ltd. and interpret your result. (iii) Are the shares of Telebank Ltd correctly priced, overpriced or underpriced? (3 marks) You have been provided with the following data regarding Telebank Ltd's returns and the corresponding market returns from 2002 to 2009: Year 2002 2003 2004 2005 2006 2007 2008 2009 Required: Return on Telebank Ltd. Return on the market 12% 14% 8% 16% 14% 10% 18% 20% 20% 26% 24% 28% 26% 18% 20% 24% (i) Calculate the standard deviations of Telebank Ltd's returns and the market returns. (4 marks) (ii) Determine the beta of Telebank Ltd. and interpret your result. (iii) Are the shares of Telebank Ltd correctly priced, overpriced or underpriced? (3 marks)
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Related Book For
Business Statistics for Contemporary Decision Making
ISBN: 978-0470910184
6th Edition
Authors: Ken Black
Posted Date:
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