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The best way to estimate an asset beta (BA) for a project your firm is considering is to: A Find a twin firm with similar
The best way to estimate an asset beta (BA) for a project your firm is considering is to: A Find a twin" firm with similar riskiness of cash flows and regress its equity returns on market returns. B Find a "twin" firm with similar riskiness of cash flows and use the weighted average of that firm's debt and equity betas. Use the expected return on the market minus the risk-free rate. D Calculate Be using your own firm's equity data and then multiply by the debt-to- equity ratio. Points possible: 1
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