43) a) b) d) e) 44) a) ..rate 45) Which of the following is incorrect? When K=K^the stock price is in equilibrium a marginal investor will want to sell its holdings if K >K^ a marginal investor will want to sell its holdings if Kg According to constant growth model the dividend growth rate is equal to the... Liabilities growth b) current assets growth c) fixed asset growth assets growth e) stock price growth If Krf is 4%, market risk premium is 10% and the stocks beta is 1.2 then the required rate of return on the stock is...... % 5+(10-5)1.2 b) 4+(10-4)1.2 c) 4+10x1.2 d) 5+10x1.2 e) 4-10x1.2 f) 4+10/1.2 The expected return on a stock that currently sells at Rs 100 with Di = Rs 5& can be sold 1 year fron now at Rs 110 is........... ..% 5/100 + 10/100 b) 5/110+10/110 c) 5/100 +5/110 d) 5/100 + 110-(100)/110 e) 5/110+10/100 The current price of a stock that can be sold after 2 years at Rs 100 with Di Rs 10 and D2 Rs 12 and equity cost of capital is 8 % is Rs........ 100/1.082+10/1.08+12/(1.08) b) 100/1.08+10/1.08+12/1.08 00/1.08+10/(1.08)2+12/1.08 100/(1.08) +10/(1.08)+12/1.08 46) a) 47) a) c)