a share os stock sells for $35 today. the beta of the stock is 1.2 and the

Fantastic news! We've Found the answer you've been seeking!

Question:

a share os stock sells for $35 today. the beta of the stock is 1.2 and the expected return on the market is 12%. the stock is expected to pay a dividend of $0.80 in one year. if the risk free rate is 5.5% what should the share price be in one year?

Related Book For answer-question

Options Futures And Other Derivatives

ISBN: 9780136939979

11th Edition

Authors: John C. Hull

See More Books

Posted Date: May 11, 2024 03:36 PM

See More Questions

Justin is considering majoring in bioinformatics. He is considering three career options: working for a Silicon Valley start-up, working for a large pharmaceutical firm, or working for a university...
CoursHeroTranscribedText: A 5-year loan in the amount of $48,000 is to be repaid in equal annual payments. What is the remaining principal balance after the third payment if the interest rate is 5...
SD Electronics, a manufacturer of LED television sets in Nepal, hired you as its financial consultant to evaluate its decision to expand its business of manufacturing Refrigerators as well in Nepal....
For OEM & Aftermarket Parts Distribution Companies (reference an example company) Describe the sales presentation method: Salesperson to buyer? Salesperson to buyer to group? Sales team to buyer...
Do values differ across generations? How so?
Promotional Products (PP) manufactures and sells electronic accessories such as smart-phone cases, flash drives, etc. PP uses a traditional full absorption costing system for financial reporting and...
Compute output in terms of equivalent units.
The adjusted trial balance for Roth Company is presented in E. Instructions (a) Prepare an income statement and a retained earnings statement for the year. (b) Prepare a classified balance sheet at...
Listed below are 10 industries. Classify each one as (a) emerging, (b) rapid-growth, (c) mature/slow-growth, (d) stagnant/declining, (e) high-velocity/turbulent, or (f) fragmented. Do research on the...
Strategy is an important starting point for any element of business, and logistics is no different in this consideration. One strategy found with logistics is to focus on customer service; this...
Dividends on Preferred and Common Stock Pecan Theatre Inc. owns and operates movie theaters throughout Florida and Georgia. Pecan Theatre has declared the following annual dividends over a six-year...
This is the trickiest break-even case to solve because there are two levels of fixed costs depending on whether 20,000 spectators is surpassed or not. It is necessary for this worksheet to have an IF...
Civilian oversight committees are often charged with reviewing police activities to ensure that police have fulfilled their duties in an ethical manner, in compliance with police rules. In an essay...
Consider three cities in South Carolina, Greenville, Columbia, and Charleston. We plan to build at least one factory and at most two warehouses. Net present valne (Revenue) and Capital Spent for each...
10. Consider the following distribution plan. Single product. Two plants: p1 and p2. Plant p2 has an annual capacity of 60,000 units. The two plants have the same production costs. Two existing...
Find the number of ways to get the following card combinations from a 52-card deck. Two red queens and two black aces OA. 192 ways OB. 1,152 ways OC. 48 ways OD. 144 ways
Critical reading SAT scores are distributed as N(500, 100). a. Find the SAT score at the 75th percentile. b. Find the SAT score at the 25th percentile. c. Find the interquartile range for SAT scores....
Reida Oil Corporation incurred the following costs during the fiscal year ending May 31, 2015. Prepare journal entries for the above transaction, assuming that Reida Oil Corporation uses the full...
Revenue and costs for Optimistic Company for the year 2015 are presented below: Prepare income statements and unclassified balance sheets for a successful efforts (SE) company and a full cost (FC)...
Elizabeth Corporation incurred the following costs during 2015: Elizabeth uses the successful efforts method of accounting. Prepare the journal entries for the year-end December 31, 2015. January 12...

a share os stock sells for $35 today. the beta of the stock is 1.2 and the

Question:

Expert Answer:

Answer To solve this problem we need to use the Capital Asset Pricing Model CAPM to calculate the e... View the full answer

Options Futures And Other Derivatives

Students also viewed these finance questions