Question: please need correct and short answer i will like your answer (a) Given a risk-free rate of 5.5% and a market return of 12%, calculate
(a) Given a risk-free rate of 5.5% and a market return of 12%, calculate ABC 's required return on equity if its beta is 1.4. (3 marks) (b) If ABC just paid a dividend of $1.39 and these dividends are expected to grow at 5% pa, calculate an estimate of its price. (3 marks) (c) If ABC's current price is $23.73, what trading recommendation would you make? (1 marks)
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
