Multiple Choice
The market expected return is 14 percent with a standard deviation of 12 percent.The risk-free rate is 5.5 percent.Security A has just paid a dividend of $1.50,which is expected to grow at a rate of 10 percent per year indefinitely.What is the current price of Security A if it has a beta of 1.4?
A) $9.93
B) $10.93
C) $20.27
D) $22.30
Correct Answer:
Verified
Correct Answer:
Verified
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