Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 15, 2024

The beta of company A is 1.75; the market risk premium is 5%, and the risk-free rate is 4%. You expect that the company will

The beta of company A is 1.75; the market risk premium is 5%, and the risk-free rate is 4%. You expect that the company will pay a dividend of $8.00 forever. What is the intrinsic stock price?

Group of answer choices

$62.75

$54.90

$75.98

$88.11

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

Multinational Finance Evaluating The Opportunities Costs And Risks Of Multinational Operations

Authors: Kirt C. Butler

6th Edition

111921968X, 978-1119219682

More Books

Students also viewed these Finance questions

Question

★★★★★

What error results if the curvature and refraction correction is neglected in trigonometric leveling for sights? (a) 3000 ft long (b) 500 m long (c) 5000 ft long

Answered: 1 week ago

Question

★★★★★

The best example of a constant perpetuity would most likely be ________. a. An annuity due b. Dividends from common stock c. Preferred stock d. An ordinary annuity

Answered: 1 week ago

Question

★★★★★

=+d) Can you reject the null hypothesis of part c? Explain.

Answered: 1 week ago

Question

★★★★★

Division managers at Asher Company are granted a wide range of decision authority. With the exception of managing cash, which is done at corporate headquarters, divisions are responsible for sales,...

Answered: 1 week ago

Question

★★★★★

% solve this task in overleaf latex editor so we can compile there % dimension box - - > black box is dimensions: 9 . 4 cm x 5 . 7 cm - - this black box needs to have image background added \...

Answered: 1 week ago

Question

★★★★★

11.8 You are currently only invested in the Natasha Fund (aside from risk-free securities). It has an expected return of 13% with a volatility of 19%. Currently, the risk-free rate of interest is...

Answered: 1 week ago

Question

★★★★★

26. You are researching the effects of a stimulant drug on patients' attitudes. State a null and an alternative hypothesis for this study

Answered: 1 week ago

Question

★★★★★

When determining if an individual has a reasonable expectation of privacy regarding information stored on a computer the investigator should: seek approval of the software provider. attempt to gain...

Answered: 1 week ago

Question

★★★★★

1-Explain all types of cost used by the Colgate Palmolive Pakistan Limited company 2-Calculate the product price (Price= cost+profit +expenses) 3-Calculate Break Even Point (B.E.P) in term of units...

Answered: 1 week ago

Question

★★★★★

An industrial health nurse implements a safe shoe and boot program in a manufacturing organization. Which components are important elements when implementing this program? Select all that apply A-...

Answered: 1 week ago

Question

★★★★★

7. 26. f(x) 8. f(x) = -x; (-2, 0), (-2, 2) Find the average rate of change of y with respect to x (a) on the interval (1,3), (b) on the interval (3, 5). 27. f(x) 28. f(x 29. f(t) e of were YA 6 (3,6)...

Answered: 1 week ago

Question

★★★★★

1. Arethere any legal implications to be aware of as a result of this selection decision? Sunrise Academy, a privately run technical college, has been operating now for four successful years....

Answered: 1 week ago

Question

★★★★★

8.1 Differentiate between onboarding and training.

Answered: 1 week ago

Question

★★★★★

8.3 Describe special considerations for onboarding.

Answered: 1 week ago

Previous Question Next Question