A share of stock with a beta of 73 now sells for 48, Ask an Expert

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A share of stock with a beta of .73 now sells for $48. Investors expect the stock to pay a year-end dividend of $4. The T-bill rate is 6%, and the market risk premium is 9%. If the stock is perceived to be fairly priced today, what must be investors’ expectation of the price of the stock at the end of the year? (Do not round intermediate calculations. Round your answer to 3 decimal places.)

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92356614

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