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Target currently pays an annual dividend in the amount of $3.25 per share (DPS). The stock is currently selling at $27.00 per share. The firm
| Target currently pays an annual dividend in the amount of $3.25 per share (DPS). | ||||
| The stock is currently selling at $27.00 per share. The firm expects its earnings and dividends | ||||
| To grow by a constant rate of 6.0%. | ||||
| You have gathered some macro-economic data: | ||||
| The risk-free rate of return on Treasury Bonds is 3.0% | ||||
| The return on the S&P 500 Market Index is 12.0% | ||||
| Target stock has a Beta of 2.0 | ||||
What is the Expected Rate of Return?
| a. | Expected Return = 12.76% | |
| b. | Expected Return = 17.76% | |
| c. | Expected Return = 18.76% | |
| d. | Expected Return = 6.00% |
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International Finance Transactions Policy And Regulation
Authors: Hal Scott, Anna Gelpern
20th Edition
1609303164, 978-1609303167
