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Assume that CAPM is valid. A share of stock is now selling for $105. It will pay a dividend of $7 per share at the end of the year. Its beta is 1. What do investors expect the stock to sell for at the end of the year? Assume the risk-free rate is 7% and the expected rate of return on the market portfolio is 16%. (Round your answer to 2 decimal places.)

Expected selling price $

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91546919

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