The market price of a security is $40. Its expected rate of return is 14%. The risk-free rate is 6%, and the market risk premium is 8%. What will the market price of the security be if its beta doubles (and all other variables remain unchanged)? Assume the stock is expexted to pay a constant dividend in perpetuity.

Question 31 1 pts The market price of a security is $40. Its expected rate of return is 14%. The risk-free rate is 6%, and the market risk premium is 8%. What will the market price of the security be if its beta doubles (and all other variables remain unchanged)? Assume the stock is expected to pay a constant dividend in perpetuity, 20 80 25.45 18.67 Previous Next