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The risk-free rate of return is 3 percent, and the expected return on the market is 7.6 percent. Stock A has a beta coefficient of
The risk-free rate of return is 3 percent, and the expected return on the market is 7.6 percent. Stock A has a beta coefficient of 1.7, an earnings and dividend growth rate of 4 percent, and a current dividend of $1.80 a share. Do not round intermediate calculations. Round your answers to the nearest cent. a. What should be the market price of the stock? $ b. If the current market price of the stock is $5.00, what should you do? be purchased. The stod -Select- should c. If the ex should not the market rises to 15.4 percent and the other variables remain constant, what will be the value of the stock? $ d. If the risk-free return rises to 6 percent and the return on the market rises to 15.8 percent, what will be the value of the stock? $ e. If the beta coefficient falls to 1.5 and the other variables remain constant, what will be the value of the stock? $
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