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You are thinking of buying a stock priced at $99 per share. Assume that the risk-free rate is about 4.5% and the market risk premium
You are thinking of buying a stock priced at $99 per share. Assume that the risk-free rate is about 4.5% and the market risk premium is 6.4%. If you think the stock will rise to $125 per share by the end of the year, at which time it will pay a $2.66 dividend, what beta would it need to have for this expectation to be consistent with the CAPM? The Beta is ____?
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