You run a market model regression to estimate the beta of Nanotech Inc. Using 5 years of monthly data you obtain an estimate of 1. The 95% confidence…

You run a market model regression to estimate the beta of Nanotech Inc. Using 5 years of monthly data you obtain an estimate of 1.94. The 95% confidence interval is 1.25 – 2.68. The risk free rate is 3% per year and the expected market risk premium is 6% per year. What is the 95% confidence interval for expected returns on Nanotech Inc?

10.5% – 19.08%

10.5% – 14.64%

14.64%

7.5% – 16.08%

14.64% – 19.08%

Order the answer to view it

Assignment Solutions
Assignment Solutions