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Below is some information that you have collected about two companies: You have run a regression of the PE ratio against beta and the expected

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Below is some information that you have collected about two companies: You have run a regression of the PE ratio against beta and the expected earnings growth rate (g), using all available comparable companies in the market. The estimated equation that defines the relation between the PE ratio, beta and expected earnings growth is given below: PE=80.25Beta+160g Note that the earnings growth rate is used in decimal format in the equation. For example, a growth rate of 1% would be entered as 0.01 in the equation. Use the information above to make the statements below true. (a) Theta Ltd is relative to the comparable companies' multiples in the market. (b) Vega Ltd is relative to the comparable companies' multiples in the market

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