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Question 2: The beta of the stock for ABC is estimated as 1.5 according to regression analysis. The market return is expected to be 10%.

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Question 2: The beta of the stock for ABC is estimated as 1.5 according to regression analysis. The market return is expected to be 10%. If the expected return on ABC's stock was found to be 12%. A. Use Capital Asset Pricing Model (CAPM) to find the risk-free rate. B. What does a 1.5 beta represent of the relationship between stock's return and market's return? C. What does a high/low beta mean for stock's risk? D. The Bradshaw Company's most recent dividend was $6.75. The historical dividend payment by the company shows a constant growth rate of 5 percent per year. What is the maximum you would be willing to pay for a share of its common stock if your required rate of return is 8 percent

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