Financial analysts have estimated the return: on shares of Drucker Corporation and the overall market portfolio under various economic conditions as follows. The return for Drucker in the following three economic

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Pls show calculation if using excel explain steps or formula
Financial analysts have estimated the returns
on shares of Drucker Corporation and the
overall market portfolio under various
economic conditions as follows. The return
for Drucker in the following three economic
states of nature are forecasted to be: -15% in
recession, +9% in moderate growth, and +30%
in a boom. Estimates for the market as a
whole in the same economic states are -10%
in recession, +10% in moderate growth, and
+20% in boom. The analyst considers each
state to be equally likely. Using these data,
compute the beta of Drucker Corporation's
stock.
Place your answer as a number with at least
three decimal places.
Transcribed Image Text:Financial analysts have estimated the returns on shares of Drucker Corporation and the overall market portfolio under various economic conditions as follows. The return for Drucker in the following three economic states of nature are forecasted to be: -15% in recession, +9% in moderate growth, and +30% in a boom. Estimates for the market as a whole in the same economic states are -10% in recession, +10% in moderate growth, and +20% in boom. The analyst considers each state to be equally likely. Using these data, compute the beta of Drucker Corporation's stock. Place your answer as a number with at least three decimal places.
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