20.

Old Quartz Gold Mining Company is expected to pay a dividend of $8 in the coming year. Dividends are expected to decline at the rate of 2% per year. The risk-free rate of return is 6% and the expected return on the market portfolio is 14%. The stock of Old Quartz Gold Mining Company has a beta of -0.25. The intrinsic value of the stock is ______.

Question 20 options:

$80.00

133.33

$200.00

$400.00

none of the above

19.

You wish to earn a return of 13% on each of two stocks, X and Y. Stock X is expected to pay a dividend of $3 in the upcoming year while Stock Y is expected to pay a dividend of $4 in the upcoming year. The expected growth rate of dividends for both stocks is 7%. The intrinsic value of stock X ______.

Question 19 options:

	cannot be calculated without knowing the market rate of return
	will be greater than the intrinsic value of stock Y
	will be the same as the intrinsic value of stock Y
	will be less than the intrinsic value of stock Y
	none of the above is a correct answer.