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A stock generates a perpetual cash flow of $6 per share, per year. The market index has an expected return of 10% and the
A stock generates a perpetual cash flow of $6 per share, per year. The market index has an expected return of 10% and the risk free rate is 4%. If the stock's listed beta is 1.0 and I believe the true beta is 1.2, how much is the stock overpriced?
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Investments
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
9th Edition
73530700, 978-0073530703
