Solutions Problems1and2canbemoderatedbymoresophisticatedstatisticaltechniques. Problem3canbelessenedbyadjustingforchangesinbusinessandfinancialrisk. Lookataveragebetaestimatesofcomparablefirmsintheindustry. StabilityofBeta Mostanalystsarguethatbetasaregenerallystableforfirmsremaininginthesameindustry. ...