ABC Company just paid a dividend of $$3\mathrm{.}00$ per share. If dividends are expected to grow at an annual rate of $4\%$ from here on out, the risk$-$free

rate is $2\%,$ABC $\text{'}$s stock is only three$-$fourth as risky as the market on average and the market risk premium is $7\%,$ according to CAPM, what is the

required rate of return on this stock and what would its PPS be today?

LATEST DIVIDEND PER SHARE

EXPECTED CONSTANT DIVIDEND GROWTH

RISK$-$FREE RATE

RISK VERSUS AVERAGE MARKET RISK

EXPECTED RETURN ON MARKET

MARKET RISK PREMIUM

REQUIRED RATE OF RETURN

PPS