4-) What is the expected growth rate (g in the formula below) of UST cash flows?...
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4-) What is the expected growth rate (g in the formula below) of UST cash flows? Is it lower or higher compared to past? P= P E k E1+g) k=0|1+rE 1 rE-9 Use the 1998 P/E ratio. k = E r-g Assume CAPM, use 5.45% treasury bond rate for risk free rate, assume market premium is 7%(this value is relative to government bonds), and market beta of 0.65. 4-) What is the expected growth rate (g in the formula below) of UST cash flows? Is it lower or higher compared to past? P= P E k E1+g) k=0|1+rE 1 rE-9 Use the 1998 P/E ratio. k = E r-g Assume CAPM, use 5.45% treasury bond rate for risk free rate, assume market premium is 7%(this value is relative to government bonds), and market beta of 0.65.
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Related Book For
Introduction to Finance Markets Investments and Financial Management
ISBN: 978-1118492673
15th edition
Authors: Melicher Ronald, Norton Edgar
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