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2. Gordon growth model ABC, Inc., currently pays a dividend of 1.22, which is expected to grow indefinitely at 5%. The current value of ABC's

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2. Gordon growth model ABC, Inc., currently pays a dividend of 1.22, which is expected to grow indefinitely at 5%. The current value of ABC's stocks based on the constant-growth dividend discount model is 32.03. IV. What is the required rate of return? 3. Optimal portfolio You are presented with two assets, a risky asset with expected return E[R] = 15% and variance of the return Op = 22%, a riskless asset with return R; = 7%. V. If an investor's coefficient of risk aversion is A = 3, what proportion of your funds should be allocated to the risky asset

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