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FOR THE COMPANY AT&T (T) based on the most recent financial data available:

Capital Asset Pricing Model

Several sources list β including Telemet and Bloomberg. Find β from 3 different sources. State which source you used. Why are the betas different from different sources?

Bloomberg β = 0.681

Yahoo Finance β = 0.44

MSN Money β = 0.38

a. Find Rf. What is the risk-free rate based on?

Rf = X

State the source of Rf

You can assume that Market Risk Premium is 6.1%. Using the information above, calculate the cost of equity using the CAPM.

b. Cost of Equity =

Based on your different estimates, what do you think that the cost of equity is?

c. Cost of Equity =

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92353097

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