Question
Jane Smith, an investor in George Inc. estimates George Inc.s beta to be 1.9. The risk-free rate is 4%, and the market risk premium is
Jane Smith, an investor in George Inc. estimates George Inc.s beta to be 1.9. The risk-free rate is 4%, and the market risk premium is expected to be 7%. Smith also expects George Inc. to pay a $1.00 dividend next year. She can currently pay $20 for George Inc., in the market and expects to sell it for $22.00 one year later. Which of the following statements regarding George Inc. is true?
Because the expected return is 15.0% and the required return based on the CAPM is 9.7%, George Inc., is currently undervalued
Because the expected return is 12.5% and the required return based on the CAPM is 10.3%, George Inc., is currently undervalued.
Because the expected return is 12.5% and the required return based on the CAPM is 6.7%, George Inc., is currently undervalued.
Because the expected return is 15.0% and the required return based on the CAPM is 17.3%, George Inc., is currently overvalue.
What is the MONTHLY payment on a $265,000 mortgage loan that has a 12% annual interest rate if you pay it off in 30 years?
i got 2,725.82 for the answer but no sure.
a 1028.61
b 2725.82
c 2674.39
d 2400.34
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started