Consider the following data for Dodger Corp.and the S&P 500:
a. What is your estimate of beta for Dodger Corp.?
b. What portion of the firm's total variance is systematic, and what portion is unsystematic?
c. What is the required rate of return for Dodger Corp. if the riskless rate is 7% and the market risk premium is 8%?
Correct Answer:
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a.
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