Question
Stocks A and B have the following data. The market risk premium is 6.0% and the risk-free rate is 6.4%. Assuming the stock market is
Stocks A and B have the following data. The market risk premium is 6.0% and the risk-free rate is 6.4%. Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT? A B Beta 1.20 1.40 Constant growth rate 7.00% 7.00% Group of answer choices Stock A must have a higher dividend yield than Stock B. Stock A could have a higher expected return than Stock B.. Stock A must have a higher required return than Stock B.. Stock B's dividend yield is greater than its dividend growth rate. Stock A must have a higher stock price than Stock B.
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