1.Which one of the following about systematic risk is most likely correct?

a.Systematic risk will be eliminated if the portfolio is well-diversified.

b.The risk premium for an individual security is based on its systematic risk.

c.Systematic risk is also known as systemic risk.

d.Systematic risk is measured by standard deviation.

2. You expect a company's dividend to grow quickly during the first few years, then slower in future years. What model is most appropriate to value its shares?

a.Differential growth model

b.Fixed growth model

c.Different growth model

d.Non-constant growth model

3. You paid $41.55 for a share of stock. You earned a total return of 8.10% after you received a dividend of $1.23 and sold the share at the end of the year. How much did you sell the share for? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

4. A company has earnings per share of $3.21. What stock price would you consider appropriate if the benchmark PE ratio is 24.0 times? (Round your answer to 1 decimal place. No $ sign, e.g., 32.1)