Rating Average Default 0.0% 0.1% 0.2% 0.45% 2.2% 5.5% 12.2%...
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Finance
Rating Average Default 0.0% 0.1% 0.2% 0.45% 2.2% 5.5% 12.2% Rate Recession Deafault Rate 0.0% 1.0% 3.0% 3.0% 8.0% 16.0% 48.0% Average Beta 0.05 0.05 0.05 0.10 0.17 0.26 0.31 Company Market Capitalization ($mm) Total Enterprise Value ($mm) Equity Beta Debt Rating Taggart 4500 Transcontinental 8000 1.1 BBB Rearden Metal 3800 7200 1.3 AAA Wyatt Oil 2400 3800 0.9 Nielson Motors 1500 4400 1.75 BB Suppose that because of the large need for steel in building railroad infrastructure, Taggart Transcontinental and Rearden Metal decide to form into one large conglomerate. Your estimate of the asset beta for this new conglomerate is closest to: 0.59 0.66 0.42 0.68
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