Problem 7-21, Stock Betas
Principles of Corporate Finance
Brealey, Myers, and Allen
13th Edition
Determine the beta of each of the stocks given a table of stock returns and the market returns.
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Determine the beta of each of the stocks given a table of stock returns and the market returns.
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Given the standard deviation of the market… find the beta using the standard deviation or find the standard deviation given the beta for a well-diversified portfolio. For the last part, they ask you about the beta of a poorly diversified portfolio given its standard deviation.
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Given the beta and standard deviation of return for two different companies along with the standard deviation of the market… determine the standard deviation of the portfolio given different weights of investment on each stock.
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Consider a bond issued by a German company with a par value, years to maturity, an annual coupon rate, and a yield to maturity. Calculate the current price of the bond in euros.
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Consider a bond issued by a Japanese company that sells for a certain percentage of its par value. The bond has a coupon rate paid annually and matures in a specific number of years. Determine the yield to maturity of this bond.
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Consider a company that has bonds on the market making annual payments, with a certain number of years to maturity, a par value, and selling for a specific price. At this price, the bonds yield a certain percentage. Determine the coupon rate on the bonds.
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Consider a company that issued bonds with a certain number of years to maturity a year ago at a coupon rate. The bonds make semiannual payments and have a par value. If the yield to maturity (YTM) on these bonds is a specific percentage, determine the current price of the bond in dollars.
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Consider a company that issued bonds with a certain number of years to maturity a couple of years ago at a coupon rate. The bonds make semiannual payments. If these bonds currently sell for a specific percentage of par value, determine the yield to maturity (YTM).
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Consider a corporation that has bonds on the market with a certain number of years to maturity, a known YTM, a par value, and a current price. The bonds make semiannual payments. Determine the coupon rate on these bonds.
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You discover a zero-coupon bond that has a certain par value and a specific number of years until maturity. The yield to maturity on this bond is given as a percentage. Calculate the dollar price of the bond, assuming semiannual compounding periods.
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