Question: could you please help with this question? Subject: Finance Course: Add : Your question: Use the following data to answer questions 13-15. Macrotough, Inc, corporation

 could you please help with this question? Subject: Finance Course: Add
could you please help with this question?

Subject: Finance Course: Add : Your question: Use the following data to answer questions 13-15. Macrotough, Inc, corporation has stock returns that exhibit a 19% standard deviation. T-Bills are returning 2. The standard deviation of the S&P 500 is 16% and Marcotough's returns are 78% correlated to the markets in the way we defined in class. Marcotough is slated to pay its first dividend in 2 years in the amount of $4, That dividend is then expected to remain constant through time. 13. Assume that you could use CAPM offectively to estimate the required rate of return on this investment. Do so, showing your work below 14. We implicitly made a very bold (and probably bad assumption in estimating the required rate of return with CAPM. What is it? 15. Using your calculation from question 13, what is the maximum price a rational investor should be willing to pay for Macrotough stock? Subject: Finance Course: Add : Your question: Use the following data to answer questions 13-15. Macrotough, Inc, corporation has stock returns that exhibit a 19% standard deviation. T-Bills are returning 2. The standard deviation of the S&P 500 is 16% and Marcotough's returns are 78% correlated to the markets in the way we defined in class. Marcotough is slated to pay its first dividend in 2 years in the amount of $4, That dividend is then expected to remain constant through time. 13. Assume that you could use CAPM offectively to estimate the required rate of return on this investment. Do so, showing your work below 14. We implicitly made a very bold (and probably bad assumption in estimating the required rate of return with CAPM. What is it? 15. Using your calculation from question 13, what is the maximum price a rational investor should be willing to pay for Macrotough stock

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