Look up information for Wal-Mart (ticker symbol: WMT) using the Get Quotes button.

Click on the link on the left hand side Key Statistics. On that page, locate Wal-Mart beta. What is the beta? What does that tell you about the riskiness of Wal-Mart? Explain. According to yahoo, the beta is .03.

Assume the risk-free rate is 4% and the market risk premium is 6%. What would be the required rate of return for Wal-Mart given your answer to part 2a?

On the same page, locate the annual dividend for Wal-Mart. On Yahoo! Finance it is called Forward Annual Dividend Rate. What is the annual dividend expected for Wal-Mart?

Using the constant growth formula presented in class and the data above, what price would you estimate for Wal-Mart according to that model if the dividend was expected to grow by a constant 3%? Show all your work in your computation.