Use the information for the question(s)below.
You are evaluating a new project and need an estimate for your project's beta.You have identified the following information about three firms with comparable projects:
-The unlevered beta for Lincoln is closest to:
A)0.95.
B)1.00.
C)1.05.
D)0.90.

Question

Use the information for the question(s)below.
You are evaluating a new project and need an estimate for your project's beta.You have identified the following information about three firms with comparable projects: 
-The unlevered beta for Lincoln is closest to:
A)0.95. 
B)1.00. 
C)1.05. 
D)0.90.

Quizplus · Accepted Answer

The average unlevered beta for the comparables is (1.15 + 0.85 + 0.95) / 3 = 0.983, which rounded to two decimal places is 1.00. Therefore, the estimate for the project's unlevered beta should be closest to 1.00.

Use the Information for the Question(s)below