Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

By using R studio R commands Thank you Below is the file capm4.csv I want to know b,c,d !! except a !!! Plz comment with

By using R studio R commands Thank you

image text in transcribed

Below is the file capm4.csv

I want to know b,c,d !! except a !!!

Plz comment with R code

image text in transcribed

a) Explain why the econometric model above is a simple regression model like those discussed in this chapter. (b) In the data file capm4.dat are data on the monthly returns of six firms (Microsoft, GE, GM. IBM. Disney, and Mobil-Exxon), the rate of return on the market portfolio (MKT), and the rate of return on the risk free asset (RISKFREE). The 132 observations cover January 1998 to December 2008. Estimate the CAPM model for each firm, and comment on their estimated beta values. Which firm appears most aggressive? Which firm appears most defensive? (c) Finance theory says that the intercept parameter ay should be zero. Does this stock, plot the fitted seem correct given your estimates? For the Micro regression line along with the data scatter. (d) Estimate the model for each firm under the assumption that 0. Do the estimates of the beta values change much

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Accidental Data Scientist

Authors: Amy Affelt

1st Edition

1573877077, 9781573877077

Students also viewed these Databases questions

Question

=+1. What does healing mean to you now?

Answered: 1 week ago