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Suppose next year's annual dividend for each stock is expected to be $2.0 a share and the dividend growth rate is 4 percent. Based

Suppose next year's annual dividend for each stock is expected to be $2.0 a share and the dividend growth rate is 4 percent. Based on the capital asset pricing model (CAPM), which one of the following stocks is correctly priced if the risk-free rate of return is 2.0 percent and the market rate of return is 10 percent? stock A beta 0.8 price $33.33 $ 25.00 B 1.1 C 1.4 $ 21.74 D 1.7 $ 20.00 E 1.9 $ 18.18

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