return Date retur 8/2 -0.4 -0.6 1/10 0.6 0.4 9/2 -0.5 -0.6 2/10 1.5 1.7 10/2 0.9 0.7 3/10 1.1 1.1 11/2 1.1 1.3 6/10 0.3 -0.1 12/2 -0.5 -0.3 7/10 -1.8 -0.3 15/2 1.6 1.7 8/10 0.5 0.5 16/2 1.0 1.0 9/10 -0.7 -0.6 17/2 -0.7 -0.6 10/10 0.7 0.1 18/2 9.8 ค.7 13/18 ค.ค -0.1

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
icon
Related questions
Question
Air Canada, WestJet, and Transat A.T. Inc. announced purchases of planes on July 18 (18/7), February 12 (12/2), and October 7 (7/10),
respectively. Given the following information, calculate the CAR for these stocks as a group. Graph the result and provide an
explanation. All of the stocks have a beta of 1, and no other announcements are made. (Round the answers (including those for
intermediate calculations) to 1 decimal place. Negative values should be indicated by a minus sign. Leave no cell blank - Be sure
to enter "O" wherever required.)
Air Canada
Market Company
WestJet
Market Company
Transat A.T. Inc.
Market Company
Date return
return Date
return
return
Date
return return
12/7 -0.3
-0.5
8/2
-0.4
-0.6
1/10
0.6
0.4
13/7
0.0
0.2
9/2
-0.5
-0.6
2/10
1.5
1.7
16/7
1.5
1.7
10/2
0.9
0.7
3/10
1.1
1.1
17/7 -0.5
-0.3
11/2
1.1
1.3
6/10
0.3
-0.1
18/7
-2.1
0.6
12/2
-0.5
-0.3
7/10
-1.8
-0.3
19/7
-0.7
-0.5
15/2
1.6
1.7
8/10
0.5
0.5
20/7 -0.9
-1.0
16/2
1.0
1.0
9/10
-0.7
-0.6
23/7
0.3
0.1
17/2
-0.7
-0.6
10/10
0.7
0.1
24/7
0.3
0.1
18/2
0.8
0.7
13/10
0.0
-0.1
Days from
announcement Air Canada
1
NTOL234
-4
-3
-2
-1
0
Abnormal returns (Ri - RM)
WestJet
Transat A.T.
Inc.
Group return
Average
abnormal
return
Cumulative
abnormal
return
Transcribed Image Text:Air Canada, WestJet, and Transat A.T. Inc. announced purchases of planes on July 18 (18/7), February 12 (12/2), and October 7 (7/10), respectively. Given the following information, calculate the CAR for these stocks as a group. Graph the result and provide an explanation. All of the stocks have a beta of 1, and no other announcements are made. (Round the answers (including those for intermediate calculations) to 1 decimal place. Negative values should be indicated by a minus sign. Leave no cell blank - Be sure to enter "O" wherever required.) Air Canada Market Company WestJet Market Company Transat A.T. Inc. Market Company Date return return Date return return Date return return 12/7 -0.3 -0.5 8/2 -0.4 -0.6 1/10 0.6 0.4 13/7 0.0 0.2 9/2 -0.5 -0.6 2/10 1.5 1.7 16/7 1.5 1.7 10/2 0.9 0.7 3/10 1.1 1.1 17/7 -0.5 -0.3 11/2 1.1 1.3 6/10 0.3 -0.1 18/7 -2.1 0.6 12/2 -0.5 -0.3 7/10 -1.8 -0.3 19/7 -0.7 -0.5 15/2 1.6 1.7 8/10 0.5 0.5 20/7 -0.9 -1.0 16/2 1.0 1.0 9/10 -0.7 -0.6 23/7 0.3 0.1 17/2 -0.7 -0.6 10/10 0.7 0.1 24/7 0.3 0.1 18/2 0.8 0.7 13/10 0.0 -0.1 Days from announcement Air Canada 1 NTOL234 -4 -3 -2 -1 0 Abnormal returns (Ri - RM) WestJet Transat A.T. Inc. Group return Average abnormal return Cumulative abnormal return
Expert Solution
steps

Step by step

Solved in 3 steps with 3 images

Blurred answer
Knowledge Booster
Effect Of Interest Rate
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Essentials Of Investments
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
FUNDAMENTALS OF CORPORATE FINANCE
FUNDAMENTALS OF CORPORATE FINANCE
Finance
ISBN:
9781260013962
Author:
BREALEY
Publisher:
RENT MCG
Financial Management: Theory & Practice
Financial Management: Theory & Practice
Finance
ISBN:
9781337909730
Author:
Brigham
Publisher:
Cengage
Foundations Of Finance
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education