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Category > Business & Finance Posted 22 May 2017 My Price 3.00

Suppose the risk-free rate of return is 3.5 percent

Suppose the risk-free rate of return is 3.5 percent and the market risk premium is 7 percent. Stock U, which has a beta coefficient equal to 0.9, is currently selling for $28 per share. The company is expected to grow at a 4 percent rate forever, and the most recent dividend paid to stockholders was $1.75 per share. Is Stock U correctly priced? Explain.

 

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Alpha Geek
(8)
Status NEW Posted 22 May 2017 05:05 AM My Price 3.00

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file 1495432005-Answer.docx preview (130 words )
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