Question
The table lists the monthly total returns on Adobe Systems Inc. common stock and the market rates of return for a 24-month period. Observation Month
The table lists the monthly total returns on Adobe Systems Inc. common stock and the market rates of return for a 24-month period. Observation Month Adobe rate of return (%) Market rate of return (%)
1 Aug 2014 3.83 4.18
2 Sep 2014 -3.77 -2.11
3 Oct 2014 1.34 2.74
4 Nov 2014 5.08 2.43
5 Dec 2014 -1.33 -0.01
6 Jan 2015 -3.54 -2.77
7 Feb 2015 12.79 5.78
8 Mar 2015 -6.52 -1.01
9 Apr 2015 2.87 0.42
10 May 2015 3.98 1.39
11 Jun 2015 2.43 -1.70
12 Jul 2015 1.21 1.65
13 Aug 2015 -4.17 -6.00
14 Sep 2015 4.65 -2.95
15 Oct 2015 7.83 7.86
16 Nov 2015 3.16 0.56
17 Dec 2015 2.71 -2.04
18 Jan 2016 -5.12 -5.67
19 Feb 2016 -4.47 -0.02
20 Mar 2016 10.16 7.03
21 Apr 2016 0.45 0.63
22 May 2016 5.57 1.79
23 Jun 2016 -3.70 0.23
24 Jul 2016 2.16 3.97
Estimate beta to two decimal places for Adobe based on this data. Hint: see Examples 16 and 17 in the lecture.
1.04
1.73
1.27
1.42
1.58
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