Question 12 Not yet answered Marked out of 4.00 Flag question The current yield to maturity...

 

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Question 12 Not yet answered Marked out of 4.00 Flag question The current yield to maturity on a government bond is 6 percent and the premium on the market portfolio is also 6 percent. An investment manager has $5,000 invested in a stock that has an estimated beta of 1.2, and another $15,000 invested in the stock of her own publicly traded firm. She calculates that the required rate of return on her total portfolio ($20,000) is 15 percent. What is the beta of her firm? Select one: 1.6 1.7 1.8 1.9 None of these answers Question 13 Not yet answered Marked out of 4.00 P Flag question The cost of capital on TKM Constructions is 15%. The firm has just paid an annual dividend of $0.40 (i.e. Do ), expects to grow future dividends at 24% for the next two years, and then 8% thereafter forever. What is the current estimated price of TKM's shares? Select one: $ 6.17 $ 6.97 $ 8.07 $ 8.91 $13.93 Question 12 Not yet answered Marked out of 4.00 Flag question The current yield to maturity on a government bond is 6 percent and the premium on the market portfolio is also 6 percent. An investment manager has $5,000 invested in a stock that has an estimated beta of 1.2, and another $15,000 invested in the stock of her own publicly traded firm. She calculates that the required rate of return on her total portfolio ($20,000) is 15 percent. What is the beta of her firm? Select one: 1.6 1.7 1.8 1.9 None of these answers Question 13 Not yet answered Marked out of 4.00 P Flag question The cost of capital on TKM Constructions is 15%. The firm has just paid an annual dividend of $0.40 (i.e. Do ), expects to grow future dividends at 24% for the next two years, and then 8% thereafter forever. What is the current estimated price of TKM's shares? Select one: $ 6.17 $ 6.97 $ 8.07 $ 8.91 $13.93

Answer rating: 100% (QA)

To calculate the beta of the investment managers firm and the current estimated price of TKM Constructions shares we can use the following formulas an... View the full answer