Question
The Island Hotel Company,Inc.just paid a dividend of$2.50per share,and that dividend is expected to grow at a constant rate of4.00per year in the future.The company's
The Island Hotel Company,Inc.just paid a dividend of$2.50per share,and that dividend is expected to grow at a constant rate of4.00per
year in the future.The company's beta is2.35,the market risk premium is6.25%,and the risk-free rate is2.00%.Using CAPM,at what
priceshould the company's stock sell?
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Small Business Management Launching and Growing New Ventures
Authors: Justin Longenecker, Leo Donlevy, Terri Champion, William Petty, Leslie Palich, Frank Hoy
6th Canadian edition
176532218, 978-0176532215
