# CAPM Steps in Calculating Asset Beta

What are the steps in calculating the Asset beta in the CAPM for purposes of calculating the cost of capital for a project?

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#### Solution Preview

Beta measures a stock's volatility, the degree to which its price fluctuates in relation to the overall market. In other words, it gives a sense of the stock's market risk compared to the greater market. Beta is used also to compare a stock's market risk to that of other stocks. Investment analysts use the Greek letter 'ß' to represent beta. ...

#### Solution Summary

This solution provides the steps to calculate asset beta in the CAPM.

$2.19