Q5.4 From the Australian Financial Review, a website such as Yahoo!7 Finance (http://au. finance.yahoo.com), or some other

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Q5.4 From the Australian Financial Review, a website such as Yahoo!7 Finance (http://au.

finance.yahoo.com), or some other source, obtain a current estimate of the risk-free rate (use a Treasury note). Use Yahoo!7 Finance to obtain the beta for each of the companies listed on page 146.

a. Compare the current betas to the April 2010 betas given in the chapter for each of the companies.

b. What might cause betas to change over time, even in a stable economic environment?

c. Use the current betas, along with a market risk premium on shares of 8.5%, to find the required return for each share with the capital asset pricing model (CAPM).

d. Compare and discuss your findings in part c with regard to the specific business that each company is in.

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