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Question 8: Done correctly, estimating a companys potential Equity Beta from comparable industry Asset Betas can be a very powerful tool. Unfortunately, it also introduces
Question 8: Done correctly, estimating a companys potential Equity Beta from comparable industry Asset Betas can be a very powerful tool. Unfortunately, it also introduces the possibility of Estimation Bias. What long-term effects would a company experience as the result of incorrectly calculating its Equity Beta due to Estimation Bias? Why?
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