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9 10 point Ashare of stock with a bete of 0.76 Dow sells for $51. Investors expect the stock to pay a year end dividend

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9 10 point Ashare of stock with a bete of 0.76 Dow sells for $51. Investors expect the stock to pay a year end dividend of $2. The bill lates and the market risk premium is 7% a. Suppose investors believe the stock will sell for $53 at year-end. Calculate the oportunity cost of capital, is the stock a good or bad buy? What wil investors do? (Do not round Intermediate calculations. Round your opportunity cost of capital calculations percentage rounded to 2 decimal places.) int Reences Opportunity cost of capital The stock is a buy and the restors b. At what price will the stock reach an equilibrium at which it is perceived as fairly priced today? (Do not round intermediate calculations, Round your answer to 2 decimal places) Stockice

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