Reading 45: Cost of Capital

Did anyone notice that several of the CFAI’s practice questions ask you to compute beta? In Schweser, there is no mention at all of calculating Beta. I was wondering if you all had noticed this and whether or not you will be memorizing those formulas. Thanks.

I have memorized it, considering its not as bad as some of the kurtosis/skewnees and t-stat formulas for comparing 2 sample means.

Yeah I notice it too. For my case, I ignore those problems becouse the LOS didn’t ask (I guess if I still recall) to compute. But I think it is much better if we could memorize the formula since the CFA will not include those problems if they are not required.

Was also surprised by this just last week. But, to be honest, levering and unlevering a beta is not that hard of a calc (compared to kurtosis)