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Suppose you are considering buying a stock. The stock is currently trading for $15. You expect the price in one year to be $16 and
Suppose you are considering buying a stock. The stock is currently trading for $15. You expect the price in one year to be $16 and it will pay a dividend of $0.75. You estimate the stock's beto at 2. the risk-free rate at 1.5\%, and the expected return on the morket at 7.5%. According to the CAPM, should you consider purchasing this stock? LO3 The intrinsic volue is $14.76. The current price is $15. You should not consider buying the stock. The Intrinsic value is $15. The current price should be \$14.76. You shouid consider buying the stock. The intrinsic value is $14.76. The current price $15. You should considet buying the stock. The intrinslc value is $13.72. The current price \$55. You should not consider buying the stock
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