Question: ABC Stock is currently priced at $ 5 0 . The stock is expected to be worth $ 5 9 in one year and you

ABC Stock is currently priced at $50. The stock is expected to be worth $59 in one year and you expect to receive a dividend of $1.00 a share. The beta of ABC is 2.00. The risk free rate is 3% and the expected return of the stock market is 10%(the market risk premium is 7%). Should you invest in ABC stock? Explain why. What is the fair value estimate for ABC stock today? This is based on the expected value (price) and cash flows (dividend)

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