Corporate Finance
Corporate Finance
12th Edition
ISBN: 9781259918940
Author: Ross, Stephen A.
Publisher: Mcgraw-hill Education,
Question
Book Icon
Chapter 14, Problem 27CQ
Summary Introduction

To discuss: The cumulative abnormal returns.

Introduction:

The difference between the actual returns and expected returns is termed as abnormal returns and the aggregate of abnormal returns are termed as cumulative abnormal returns.

Blurred answer
Students have asked these similar questions
Whether Altman’s Z-score model would be useful in predicting the financial failure of Australian mining companies
9. If a gold mine allows the investor the option to dig later, what must happen for the option to be exercised? A.Gold prices must be high relative to possible future prices. B.The present value of oil must be higher than the future value of oil. C.Interest rates must increase. D.The probability of oil prices increasing must be less than the probability of oil prices decreasing.
Applying the capital asset pricing model requires that one find appropriate inputs for the risk-free rate, the market rate of return (and market risk premium), and beta. Why is beta, in particular, difficult to pin down?   a. People don't have ready access to financial data and won't have any source for this information  in the near future. b. The major internet sources of financial data are notoriously unreliable. c. Hackers have been known to manipulate financial data for their own purposes. d. People must rely on historical performance information, and they have to assume that historical relationships continue into the future.
Knowledge Booster
Background pattern image
Similar questions
SEE MORE QUESTIONS
Recommended textbooks for you
Text book image
Financial Management: Theory & Practice
Finance
ISBN:9781337909730
Author:Brigham
Publisher:Cengage
Text book image
International Financial Management
Finance
ISBN:9780357130698
Author:Madura
Publisher:Cengage