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ii) Samsung stock is currently selling for $120.00 per share and the firm's dividends are expected to grow at 6 percent indefinitely. In addition, Samsung's
ii) Samsung stock is currently selling for $120.00 per share and the firm's dividends are expected to grow at 6 percent indefinitely. In addition, Samsung's most recent dividend was $3.50. The expected risk-free rate of return is 4 percent, the expected market return is 7 percent, and Samsung has a beta of 1.60 . a. Based on the dividend valuation model, what return do investors expect to earn in the future? ( 2 marks) b. What is the expected return based on the CAPM? (2 marks) c. Would Samsung be a good investment at this time? Explain (2 marks)
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