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QUESTION 2 The current price of IBM is $58. Analyst expects that IBM stock price will be $70 pay dividends $5 next year. Also the

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QUESTION 2 The current price of IBM is $58. Analyst expects that IBM stock price will be $70 pay dividends $5 next year. Also the beta is estimated as 0.9. Assume the RoR (required returns) should be 124, 1) what is the intrinsic price of IBM? 2) is the stock overpriced or underpriced? 3) what is the relationship between the RoR and the expected holding period returns? O 56.96 Underpriced ROR HPRS

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