Question
A stock is selling for $50 in the market. The company's beta is 1.2, the market risk premium (r M - r F ) is
A stock is selling for $50 in the market. The company's beta is 1.2, the market risk premium (rM- rF) is 5%, and the risk-free rate is 6%. The most recent dividend paid is D0= $2.0 and dividends are expected to grow at a constant rate g. What's the required rate of return by common shareholders?
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Investments
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
9th Edition
73530700, 978-0073530703
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