2.1 Using monthly data for the period from 1/1/2013 to 1/1/2020, estimate equity beta for Facebook. Compare your estimate of Facebooks equity beta with the Facebooks beta provided by Yahoo Finance and comment on any differences. Guidelines: - Go to Yahoo Finance (finance.yahoo.com/), under the Markets Tab, you will find US Treasury Bonds Rates, then look for Treasury Yield 10 Years (listed symbol TNX). Then click on TNX/Historical Data and get monthly data (AdjClose) of TNX for the period from 1/1/2013 to 1/1/2020. Use this data series as the risk-free rate for this period. - Go to Yahoo Finance (finance.yahoo.com/), then enter search term Facebook or symbol FB, then click on Historical Data and get monthly prices (AdjClose) of Facebook for the period from 1/1/2013 to 1/1/2020. Then calculate Facebooks monthly return for this period. - Go to Yahoo Finance (finance.yahoo.com/), then enter search term S&P500, then click on Historical Data and get monthly data (AdjClose) of S&P for the period from 1/1/2013 to 1/1/2020. Please use this as the market index and then calculate monthly market return for this period. - Use Excel to estimate Facebooks equity beta. You will need to report the summary output of the regression in the report.

2.2. Assuming that beta you estimated in 2.1 is the true value of Facebooks equity beta, estimate yearly cost of equity for Facebook for the 31/12/2012-31/12/2019 period. Comment on your estimate. Guideline: if data on market return and risk free rates are not available on 31/12 of each year, you can use the data on these variables on 1/1 of the next year.