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Beta, required rate of return, and intrinsic value: You have collected the below information to determine SABIC's intrinsic vlaue - The risk-free rate (SAIBOR) is
Beta, required rate of return, and intrinsic value: You have collected the below information to determine SABIC's intrinsic vlaue - The risk-free rate (SAIBOR) is 3% - The Expected return on the Market Portfolio (TASI) is 10% - The next period dividends (D1) = SAR 5 and SABIC will distribute D1 forever. - The historical return on SABIC stock and TASI for the period from 2018 - 2021 as follows: Years SABIC Ret 2021 5% 2020 9% 2019 14% 2018 25% TASI Ret 10% 13% 17% 19% a. SABIC's Beta is b. SABIC's required rate of return is % C. SABIC's estimated SABIC price (intrinsic vlaue) is SAR
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