Survey and Experiment: corporate Finance- Graham & Harvey Case Study- Case Study Assignment Help

Internal Code: 4BAE

Case Study Assignment Help:

Task: Question 1:  Survey Method     (15 marks total as indicated below) Please refer to the following paper: Graham, J. R., & Harvey, C. R. (2001). The theory and practice of corporate finance: Evidence from the field. Journal of Financial Economics, 60(2-3), 187-243. In this paper, the authors survey 392 CFOs about the cost of capital, capital budgeting, and capital structure.   With reference to Graham & Harvey (2001), please answer the following questions.

1. The survey received a response rate of 9%. In 100 words or less, discuss if this response rate is sufficient?Why/why not?
2. In 150 words or less, discuss ifGraham and Harvey (2001)have addressed the issue of endogeneity. Your answer should address the following: Provide a brief definition of endogeneity.

• Identify if the paper suffers from any of the common causes of endogeneity and provide a clear justification for your answer.
• Identify what Graham and Harvey could have done differently to address the issue of endogeneity and provide a clear justification for your answer.

[Note: your answer needs to go beyond a mere definition of the concept of endogeneity - you need to demonstrate that you understand endogeneity as it relates to the paper by Graham & Harvey]

1. In 150 words or less, discuss if the Graham and Harvey(2001) have addressed the issue of common method variance. Your answer should address the following:

• Provide a brief explanation of common method variance.
• Identify four approaches that have been recommended in the literature as methods that researchers should use to avoid or correct common method variance and discuss if and how these approaches have been used by Graham and Harvey.

[Note: your answer needs to go beyond a mere definition of the concept of common method variance - you need to demonstrate that you understand common method variance as it relates to the paper by Graham & Harvey]