The following information is available with respect of AK Ltd. Year AK Limited Market Return on Govt. Bonds Average Share Price (₹) DPS (₹) Average…

(a) Computation of Beta Value Calculation of Returns Returns = (D₁ +(P1-Po)) / Po × 100 Year Returns 2022-2023 (25+(279-242)) / 242 × 100 = 25.62% 2003-2004 (30+(305-279)) / 279 × 100 = 20.07% 2004-2005 (35+(322-305)) / 305 × 100 = 17.05% Calculation of Returns from market Index Year % of Index Appreciation Dividend Yield % Total Return % 2022-2023 (1950-1812) / 1812 × 100 = 7.62% 5% 12.62% 2023-2024 (2258-1950) / 1950 × 100 = 15.79% 6% 21.79% 2024-2025 (2220-2258) / 2258 × 100 = (-)1.68% 7% 5.32% Computation of Beta Year X Y XY Y² 2022-2023 25.62 12.62 323.32 159.26 2023-2024 20.07 21.79 437.33 474.80 2024-2025 17.05 5.32 90.71 28.30 ΣX = 62.74 ΣY = 39.73 ΣXY = 851.36 ΣY² = 662.36 X = 62.74 / 3 = 20.91, Y = 39.73 / 3 = 13.24 β = (ΣXY - nXY) / (ΣY² - n(Y)²) = (851.36 - 3(20.91)(13.24)) / (662.36 - 3(13.24)²) = (851.36 - 830.55) / (662.36 - 525.89) = 20.81 / 136.47 = 0.15 (b) Observation: Based on the beta value of the company and the analysis of returns, it can be concluded that changes in the return on share of AK Ltd. are less affected by changes in market returns.