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I am really grateful to you for everything to answering my questions so quickly and also for giving advice. I thank you a lot and I am really pleased to be part of the OpenTuition Community.
You are really doing a great job. Wish you good luck in your future endeavors and thanks again for helping me. 🙂
Now, I have a clearer image of what is expected on my part. Thanks for your explanation and time. I am really gratefully to you as your explanations have been really concise.
Unfortunately, I do not have the answer to this question. I have gone multiple times through the BPP book looking for parts explaining the factors affecting the equity beta but there were none.
I apologise for what I am going to say but to what specific lecture are you referring at when you are saying the lectures explain everything with regard to the factors affecting the equity beta because I am a bit confused as I have been questioning whether I have misinterpreted the question.
Thanks for your reply.
Yes, I have watched them.
Actually, you are indeed right since the risk to a business is firm-specific. Since it is by removing this risk that we can calculate the asset beta.But what I could not find in the lectures is exactly what factors affected a company’s equity beta apart from the gearing?
Because for the amount of marks that the question provided, is stating and explaining only the gearing factor enough?
I am very sorry for the trouble that the structure of my question may have caused you. Actually, what I wanted to know if we are taking about the riskiness of the business and the gearing of a company aren’t we talking about the same thing? Because the riskiness of a business is perceived by its debts, that it’s gearing?
