What will a beta book compute as the adjusted beta

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Reference no: EM131910228

A stock recently has been estimated to have a beta of 1.18:

a. What will a beta book compute as the "adjusted beta" of this stock? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

b. Suppose that you estimate the following regression describing the evolution of beta over time:

ßt = 0.7 + 0.3ßt-1

What would be your predicted beta for next year? (Do not round intermediate calculations. Round your answer to 3 decimal places.)

Reference no: EM131910228

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