Question: Can you please provide the explanation, formula and correct answer for the problem above? Based on the following information concerning Applied Materials preferred stock, Preferred

Can you please provide the explanation, formula and correct answer for

Can you please provide the explanation, formula and correct answer for the problem above?

Based on the following information concerning Applied Materials preferred stock, Preferred dividend per share: $4 Beta: 1.2 Risk free rate; 5% Market risk premium: 8% You expect the risk free rate to decrease to 4% and the market risk premium to increase to 10% by the end of year 3 . Calculate the expected price in 3 years. Select one: a. $24.2 b. $23.6 C. $26.7 d. $25

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