If a firm's beta was calculated as 0.6 in a regression equation, Merrill Lynch would state the adjusted beta at a number

Related MCQs

• Merrill Lynch estimates the index model for a stock using regression analysis involving total returns. They estimated the intercept in the regression equation at 6% and the β at 0.5. The risk-free rate of return is 12%. The true β of the stock is ________.
• The intercept calculated by Merrill Lynch in the regression equations is equal to
• The Security Risk Evaluation book published by Merrill Lynch uses the __________ as a proxy for the market portfolio.
• You invest 55% of your money in security A with a beta of 1.4 and the rest of your money in security B with a beta of 0.9. The beta of the resulting portfolio is
• According to the Efficient Market Hypothesis (EMH) I. Stocks with smaller beta will be consistently overpriced. II. Stocks with higher beta will be consistently underpriced. III. Positive alphas on stocks will not remain for a longer period.
• Analysts may use regression analysis to estimate the index model for a stock. When doing so, the slope of the regression line is an estimate of ______________.
• Information about return on an investment is as follows: (a) Risk free rate 10% (b) Market Return is 15% (c) Beta is 1.2 What would be the return from this investment?
• At the prevailing environment, the Capital Market Line (CML) equation for a portfolio is given as E(ri),% = 8 + 0.36 ?i The ex-ante SML equation for the same portfolio i is E(ri),% = 8 + 5.50 ?i Therefore, the variance of market portfolio is approximately
• The "real", or inflation-adjusted, exchange rate, is
• In the stock-price beta estimation for the Coca-Cola Company, the dependent variable is the: