You find a stock with a beta of 1.4 that is expected to pay a dividend of

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You find a stock with a beta of 1.4 that is expected to pay a dividend of $3.20 and grow that dividend at 5% annually. If the risk-free rate is 3% and the expected market return is 8%, what should be the price of this stock?

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Financial Management Theory and Practice

ISBN: 978-0176517304

2nd Canadian edition

Authors: Eugene Brigham, Michael Ehrhardt, Jerome Gessaroli, Richard Nason

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Posted Date: Feb 26, 2024 04:28 AM

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You find a stock with a beta of 1.4 that is expected to pay a dividend of

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Expert Answer:

To calculate the price of the stock we can use the dividend discount model DDM formula ... View the full answer

Financial Management Theory and Practice

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