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Part3 The goal of this exercise is to use stock price data to calculate the beta (systematic risk measure) for Archer Daniels Midland (ADM). 1.

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Part3 The goal of this exercise is to use stock price data to calculate the beta (systematic risk measure) for Archer Daniels Midland (ADM). 1. Start by downloading the monthly stock prices and dividends for Archer Daniels and the S\&P 500 in the Excel spreadsheet on the course website. Use the price and dividend information to compute monthly rates of return for each series over the entire period for which data are available. 2. Using either Excel's Regression Analysis tool or the Excel LINEST() function, estimate a regression with Archer Daniel's monthly excess return as the dependent (Y) variable and the S\&P 500 excess return as the independent (X) variable. To compute monthly excess returns, assume the effective annual risk free rate is 3%. 3. Next, compute the and by instead using the analytical formula given in the Example in the textbook. 4. Finally, compare the beta you computed from the two methods to the beta for Archer Daniels listed in the upper left-hand corner of Value Line's Stock Report. Do your results match the Value Line beta? What might explain the differences

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