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You are considering investing in a new stock, Mega Growth Inc (MGI), and have decided to do some analysis before

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You are considering investing in a new stock, Mega Growth Inc (MGI), and have decided to do some analysis before pulling the trigger. The beta of MGI is 1.5, the market risk premium 6.7%, and the risk free rate is 1.6%. You expect that the price of MGI in stock in one year will be $100, and that MGI will pay no dividends in the next year. The most you would be willing to pay for one share of MGI stock today is closest to:

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Financial Management Theory and Practice

Financial Management Theory and Practice

ISBN: 978-1305632295

15th edition

Authors: Eugene F. Brigham, Michael C. Ehrhardt

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Posted Date: September 24, 2023 03:56:01
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