A Review of the Use of Beta in Regulatory Proceedings
The Supreme Court in 1944 stated that "the return to the equity owner should be commensurate with returns on investment in other enterprises having corresponding risks" (FPC v. Hope Natural Gas). Such a decree essentially created a new service industry -- a cadre of well-paid financial pra...
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| Veröffentlicht in: | Financial management 1981-12, Vol.10 (5), p.75-81 |
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| container_title | Financial management |
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| creator | Cooley, Philip L. |
| description | The Supreme Court in 1944 stated that "the return to the equity owner should be commensurate with returns on investment in other enterprises having corresponding risks" (FPC v. Hope Natural Gas). Such a decree essentially created a new service industry -- a cadre of well-paid financial practitioners and theoreticians who express their opinions on equity cost of public utilities. One group of recent origin among such expert witnesses uses beta as a measure of risk. How this group measures and uses beta to estimate cost of equity capital is the topic of this study. |
| doi_str_mv | 10.2307/3664859 |
| format | Article |
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| identifier | ISSN: 0046-3892 |
| ispartof | Financial management, 1981-12, Vol.10 (5), p.75-81 |
| issn | 0046-3892 1755-053X |
| language | eng |
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| source | Jstor Complete Legacy; Alma/SFX Local Collection; Periodicals Index Online; EBSCOhost Business Source Complete |
| subjects | Beta Capital asset pricing models Capital assets Commercial regulation Cost estimates Cost of equity Costs Discounted cash flow Economic regulation Equity capital Estimates Estimating techniques Investment return rates Investment risk Market portfolios Pricing Public utilities Rates of return Regulation Risk Telephones Testimony Witnesses Yield |
| title | A Review of the Use of Beta in Regulatory Proceedings |
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