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The expected rate of return on the market is 17.6%. The T-bill rate is 2.5%. (1) What is the expected rate of return for a
The expected rate of return on the market is 17.6%. The T-bill rate is 2.5%. (1) What is the expected rate of return for a stock that has a beta of 1.0? (2) What is the beta of a stock with an expected return of 15% ? (3) If investors expect a stock with a beta of 1.1 to sell for $82 per share at the end of the year. It will pay a dividend of $3.4 at the end of the year. What should be the market price of the stock today?
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