25. Kleenex is a multi-divisional utility company. Kleenex has four divisions wi

Question

25. Kleenex is a multi-divisional utility company. Kleenex has four divisions with the following betas and proportions of the firm's total assets:

Division                           Beta                % of Assets
Electric & Gas                     1.28                       25
Bus transportation               2.15                   36
Real estate                         0.76                    15
Recreation                          1.35                    24

What is the firm's weighted average beta?

A.       1.190
B.       1.532
C.       1.328
D.       1.054

Explanation / Answer

Beta Percentage Beta 1.28 0.25 0.32 2.15 0.36 0.774 0.76 0.15 0.114 1.35 0.24 0.324 Weighted Average Beta 1.532 The correct answer is B. 1.532

Related Questions

Navigate

• Browse (All)
• Browse 2
• Subjects