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Assuming the best/baseline/worst case scenario probabilities to have a 20% / 60% / 20% distribution, what is your estimate for the share value? You are
Assuming the best/baseline/worst case scenario probabilities to have a 20% / 60% / 20% distribution, what is your estimate for the share value?
You are analyzing the shares of Gotta Dance Corporation to determine whether your fund should add their shares to the portfolio. The following information is the result of your analysis: Beta 1.36 Risk-free rate 1.8% Market risk premium 7.0% Current dividend $ 7.00 You have modelled three potential scenarios for the short-term and long-term growth of GottaDance going forward: Baseline 9.0% Supernormal growth Growth period Long-term growth Best 12.0% 5 years 2.5% Worst 4.0% 2 years 1.2% 3 years 2.0%Step by Step Solution
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