A):. Compute the Beta of AMZN stock compare to the benchmark represented by the S&P500 index over 61 months. a. Compute

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A):. Compute the Beta of AMZN stock compare to
the benchmark represented by the S&P500 index over 61
months.
a. Compute the monthly log returns of AMZN.
b. Compute the excess returns of AMZN by subtracting to a) the
monthly return of the 10-year US Government Bond yield.
c. Compute the log returns of the S&P500 index.
B ) : Fullen Machinery is investing $400
million in new industrial equipment. The present value of the
future after-tax cash flows resulting from the equipment is $700
million. Fullen currently has 85.5 million shares of common stock
outstanding, with a current market price of $36 per share. Assuming
that this project is new information and is independent of other
expectations about the company, what is the theoretical effect of
the new equipment on Fullen's stock price? The stock price
will:
d. Compute the excess returns of the S&P500 index by
subtracting to c) the monthly return of the 10-year US Government
Bond yield.
e. Apply an OLS by using the toolbox of Excel (Data/ Data
Analysis/Regression) b) (dependent variable) versus d) (independent
variable).
f. Is Bêta significant? Why?
g. Adjust Bêta, making the hypothesis that the standard error of
Bêta population is equal to 0.30. What is the value of Adjusted
Bêta ?