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The risk-free rate of return is 4 percent, and the expected return on the market is 8.7 percent. Stock A has a beta coefficient of

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The risk-free rate of return is 4 percent, and the expected return on the market is 8.7 percent. Stock A has a beta coefficient of 1.2, an earnings and dividend growth rate of 6 percent, and a current dividend of $2.40 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 $50.00, what should you do? The stock Select be purchased c. the expected return on the market rises to 12 percent and the other variables remain constant, what will be the value of the stock? $ d. the lok free return rives to 7 percent and the return on the market rise to 12.6 percent, what will be the value of the stock $ - the beta coefficient fails to 1.1 and the other variables remain constant, what will be the value of the stock $ 1. Explain why the stock's value changes in c through The increase in the return on the market Select the required return and Scient the value of the stock The increase in the risk-free rate and the simultaneous increase in the return on the market cause the value of the stock to see The decrease in the beta coefficient causes the firm to become Seed risky as measured by bets, which Select the value of the stock

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