Question
BF Ltd has just paid a dividend of $3 per share. If the dividends are expected to grow at a constant rate of 4% per
BF Ltd has just paid a dividend of $3 per share. If the dividends are expected to grow at a constant rate of 4% per year indefinitely, what will be the share price (to the nearest dollar) in 4 years- time, if investors require a return of 6%?
Group of answer choices
A. $182
B. $189
C. $135
D. $156
Currently, your portfolio consists of $3,000 invested in share A with a beta of 0.7 and $4,000 in share B with a beta of 0.5. You have another $12,000 to invest and want to divide it between share C with a beta of 1.3 and a risk-free asset. You want your portfolio beta to be 0.9. How much (to the nearest dollar) should you invest in the risk free asset?
Group of answer choices
A. $10,000
B. $ 2,000
C. $8,800
D. $3,000
Consider the following information about a share portfolio :
State of Economy | Probability of State of Economy | Portfolio Return if the State Occurs | |
Boom | 0.6 | 15% | |
Bust | 0.4 | 4% |
What is the portfolio risk ?
A. 2.9%
B. 4.62%
C. 3.27%
D. 5.39%
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