Question: The Chapter Resources section of MyFinanceLab has data on Microsoft and the S&P 500 from 1986 to 2006. a. Estimate Microsofts beta using linear regression
The Chapter Resources section of MyFinanceLab has data on Microsoft and the S&P 500 from 1986 to 2006.
a. Estimate Microsoft’s beta using linear regression over the periods 1987–1991, 1992–1996, 1997–2001, and 2002–2006.
b. Compare the four estimated betas. What do you conclude about how Microsoft’s exposure to systematic risk changed over that 20-year period? What do you think explains the change?
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a 19871991 14110 19921996 08544 19972001 18229 20022006 10402 b It decreased in the early 1990s as Microsoft established itself as the dominant operating software company but increased during the inte... View full answer
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