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Suppose the market portfolio is equally likely to increase by 19% or decrease by 5%.

a. Calculate the beta of a firm that goes up on average by 50% when the market goes up and goes down by 12% when the market goes down.

b. Calculate the beta of a firm that goes up on average by 10% when the market goes down and goes down by 8% when the market goes up.

c. Calculate the beta of a firm that is expected to go up? 4% independently of the market.

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92720082

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