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Assume That the S&P/TSX Composite Index Currently Has a Dividend

Question 100

Multiple Choice

Assume that the S&P/TSX Composite Index currently has a dividend yield of 3% and that on average,the dividends of S&P 500 firms have increased by about 5% per year.If the risk-free interest rate is 4%,then your estimate for the future market risk premium is:


A) 7%
B) 8%
C) 6%
D) 4%

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