Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on May 22, 2024

Question 8 0/2 points A stock has a beta of 0.82, the risk-free rate is 1.11% and the market premium is 3.16%. The stock

Question 8 0/2 points A stock has a beta of 0.82, the risk-free rate is 1.11% and the market premium is 3.16%. The stock will pay a $1.93 as dividend for 35 years (starting a year from now) and after that nothing (firm will liquidate). What is the price of the stock? Round the answer to two decimal places. Answer: 3.70 x (37.53)

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

Recommended Textbook for

Introduction To Derivatives And Risk Management

Authors: Don M. Chance, Robert Brooks

10th Edition

130510496X, 978-1305104969

More Books

Students also viewed these Finance questions

Question

Selected financial data for Amberjack Corporation follows. Year 1 ($ thousands) Year 2 ($ thousands) Sales 273,161 460,445 Cost of goods sold 251,191 343,244 Net income (157,044) (403,709) Cash flow...

Answered: 1 week ago

Question

★★★★★

(a) List two experimental conditions under which gases deviate from ideal behavior. (b) List two reasons why the gases deviate from ideal behavior. (c) Explain how the function PV/RT can be used to...

Answered: 1 week ago

Question

★★★★★

5.10 Hoskin et al. (1986) investigated the change in fatal motor-vehicle accidents after the legal minimum drinking age was raised in 10 states. Their data were the ratios of the number of...

Answered: 1 week ago

Question

★★★★★

Each round played by a contestant is either a success with probability p or a failure with probability 1 p. If the round is a success, then a random amount of money having an exponential distribution...

Answered: 1 week ago

Question

★★★★★

Identifying financial versus managerial accounting items Required Indicate whether each of the following items is representative of managerial or of financial accounting. a. Information is provided...

Answered: 1 week ago

Question

★★★★★

A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term bond fund, and the third is a money market fund that provides a safe return of 8% (let...

Answered: 1 week ago

Question

★★★★★

Forced labor is immoral and should never be condoned. What other issues should companies be aware of that could exist in their supply chains? What are some examples of these issues and the companies...

Answered: 1 week ago

Question

★★★★★

explain why U.S. presidents often favor a "lower dollar" over the course of their presidency. Explain the relationship between the relative value of the dollar and its relationship to U.S. exports...

Answered: 1 week ago

Question

★★★★★

The real cost of palm oil case study discussed how the unsustainable farming of palm in Borneo, Sumatra and lower China is perhaps the biggest threat to _____________________. Group of answer choices...

Answered: 1 week ago

Question

★★★★★

The term for the legal death of the artificial "person" of Sun Star Corp., or any other corporation, is Group of answer choices winding up. takeover. surviving corporation. dissolution.

Answered: 1 week ago

Question

★★★★★

Given a choice, a buyer of real property wants a quitclaim deed rather than a general warranty deed . True or false?

Answered: 1 week ago

Question

★★★★★

Lucy would like to receive $60,000 in the first year of her financial independence at age 60. After this first income payment, she is content with her annual income growing at the rate of inflation....

Answered: 1 week ago

Question

★★★★★

If it is possible, I need income statements, job cost reporting, ABC costing, and budgets with work. Sales in Units 160,000 Please use for Sales price per unit Tab 1 Cost of goods sold 21.00 per unit...

Answered: 1 week ago

Question

★★★★★

Borrowing costs should be recognised as an expense and charged to the profit and loss account of the period in which they are incurred : A. If the borrowing costs relate to qualifying asset B. If the...

Answered: 1 week ago

Question

★★★★★

P7.17 Listed here are the 2009 and 2010 financial statements for Otago Bay Marine Motors, a major manufacturer of top-of-the-line outboard motors. a. On the basis of the information provided,...

Answered: 1 week ago

Question

★★★★★

P7.12 FigureltOut Corporation has a net profit margin of 8% and a total asset turnover of two times. What is the company's return on assets?

Answered: 1 week ago

Question

★★★★★

P7.20 Doris Wise is a young career woman. She lives in Phoenix, Arizona, where she owns and oper- ates a highly successful modeling agency. Doris manages her modest but rapidly growing invest- ment...

Answered: 1 week ago

Previous Question Next Question