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a) Consider the following order book for the shares of a listed company. An investor wants to buy 30 shares in this company. How large
a) Consider the following order book for the shares of a listed company. An investor wants to buy 30 shares in this company. How large is the average price per share the investor has to pay? (2p) b) A firm has retention ratio b=0.75. How large is the P/E ratio of this firm if the discount rate k=0.05 and the dividend growth rate is 4% ? (2p) c) In an exact factor model with one factor, two risky assets satisfies R1=R1+2I1R2=R2+3I1. How large is R2 if there is a risk-free asset with RF=0.01 and R1=0.15 ? (2p) a) Consider the following order book for the shares of a listed company. An investor wants to buy 30 shares in this company. How large is the average price per share the investor has to pay? (2p) b) A firm has retention ratio b=0.75. How large is the P/E ratio of this firm if the discount rate k=0.05 and the dividend growth rate is 4% ? (2p) c) In an exact factor model with one factor, two risky assets satisfies R1=R1+2I1R2=R2+3I1. How large is R2 if there is a risk-free asset with RF=0.01 and R1=0.15 ? (2p)
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