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What is the interpretation of a price-to-book ratio which =1? Is this likely? Why or why not? Why would a price-to-book- ratio be >1? Why

  1. What is the interpretation of a price-to-book ratio which =1? Is this likely? Why or why not? Why would a price-to-book- ratio be >1? Why would it be <1?
  2. The Hong Kong Tramways Company (HKTC) is valued at $20 per share. Analysts expect that it will generate free cash flows to equity of $4 per share for the foreseeable future. What is HKTC's implied cost of equity capital?

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