When is the earnings response coefficient likely to be relatively high?

a.When the firm is high risk

b.when analysis earnings forecasts are precise

c.when firm it's very large

d when a large non-recurring gain is known to be included in operating income

which of the following statements about earnings response coefficient is correct?

a.ERC is positively related to Beta risk

b.ERC is positively related to the debt to equity ratio

c.ERC is positively related to earnings persistent

d.ERC is negatively related to earnings quality

which of the following statements about earnings response coefficient is correct?

a.An earnings response coefficient is positively related to beta risk

b.an earnings response coefficient is measured as the ratio of abnormal stock returns divided by unexpected earnings

c.an earnings response coefficient is the ratio of unexpected earnings divided by abnormal earnings

d.an earnings response coefficient is measured only for quarterly earnings released by firms