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A firm's class A common shares are currently trading for $13.70 on the Toronto Stock Exchange. The risk free rate prevailing in the market is

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A firm's class A common shares are currently trading for $13.70 on the Toronto Stock Exchange. The risk free rate prevailing in the market is currently 5%, the expected return on the market portfolio is 11%. The firm has a beta of 1.6 and is expected to pay a dividend of $2 forever. Under these conditions, the firm's common shares are currently: undervalued. overvalued. fairly valued. strongly valued. A firm's class A common shares are currently trading for $13.70 on the Toronto Stock Exchange. The risk free rate prevailing in the market is currently 5%, the expected return on the market portfolio is 11%. The firm has a beta of 1.6 and is expected to pay a dividend of $2 forever. Under these conditions, the firm's common shares are currently: undervalued. overvalued. fairly valued. strongly valued

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