1-Which of the following conclusions would you be willing to draw about betas?

a. Emerging market telecom companies should have higher betas than developed market telecom companies. Beta should be higher if the proportion of fixed costs/total costs is low

b. Emerging market telecom companies should have higher betas than developed market telecom companies. Beta should be higher if the proportion of fixed costs/total costs is high

c. Developed market telecom companies should have higher betas than emerging market telecom companies. Beta should be higher if the proportion of fixed costs/total costs is low

d. Developed market telecom companies should have higher betas than emerging market telecom companies. Beta should be higher if the proportion of fixed costs/total costs is high

e-Companies in the same business should have the same betas

2-Which of the following statements is FALSE?

a. Firms with regular dividends are often reluctant to cut dividends due to adverse investor reactions. As a result, firms with temporary excess cash should use special dividends or share repurchases to return cash to shareholders rather than regular dividends

b. Equity repurchases can help insiders increase their control of a firm

c. Managers that receive equity options as part of their compensation may prefer share repurchases to dividends

d. If dividends are taxed at higher rates than capital gains, then shareholders will prefer buybacks to dividends

e. By definition, share repurchases can only benefit shareholders whose shares are actually repurchased. The remaining shareholders will be neither better nor worse off