In Lecture 1 Part 6, we covered application of CAPM (SML) beta to corporate finance. The 'normal' view of betas is that CAPM-generated betas should not be negative enough to generate negative cost of equity. Yet, some researchers, notably Aktas, E. and W.R. McDaniel (2009), "Pragmatic problems in using beta for managerial finance applications", Applied Financial Economics, 19:16, 1345-1354 (https://www.tandfonline.com/doi/abs/10.1080/09603100802570390 Links to an external site.see also attached) show cases "where CAPM-generated costs of equity are less than zero; less than the risk-free rate and less than the company's marginal cost of debt". They calculate betas using 60 and 120-monthly returns. They also refer to a "COMPUSTAT file with 8361 companies with listed betas: 925 of these are negative". Discuss, why would CAPM betas fail to properly estimate the true cost of equity, especially in periods of systemic crises (e.g. Global Financial Crisis and the subsequent Great Recession, and during the Covid19 pandemic)? Do you expect CAPM to provide reasonable estimates of the cost of capital in today's business environment? Why? Why not?