Question
The market price of a security is $66. Its expected rate of return is 12%. The risk-free rate is 6%, and the market risk premium
| The market price of a security is $66. Its expected rate of return is 12%. The risk-free rate is 6%, and the market risk premium is 10%. 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. (Round your answer to 2 decimal places.) |
| Market price | $ |
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The Principles And Practice Of Auditing
Authors: George Puttick, Sandra Van Esch
8th Edition
0702156914, 978-0702156915
