Answered step by step
Verified Expert Solution
Question
00
1 Approved Answer
49. Assume risk free rate of return is equal to 6.05%. Stock PV has a beta of 2.0, an expected constant growth rate of dividends
49. Assume risk free rate of return is equal to 6.05%. Stock PV has a beta of 2.0, an expected constant growth rate of dividends of 7 percent, and the last dividend paid was $2, what market price gives the investor a return consistent with the stock's risk, assuming CAPM holds? Select one: O a. $24.83 b. $37.50 c. $56.94 d. $21.72 e. $42.38 49. Assume risk free rate of return is equal to 6.05%. Stock PV has a beta of 2.0, an expected constant growth rate of dividends of 7 percent, and the last dividend paid was $2, what market price gives the investor a return consistent with the stock's risk, assuming CAPM holds? Select one: O a. $24.83 b. $37.50 c. $56.94 d. $21.72 e. $42.38
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started