Problemebay currently has a beta of one additionally the, Ask an Expert

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Problem:

Ebay currently has a beta of one. Additionally, the rate of return in the market has been .12 historically, and the risk premium is .16. You know that Ebay will grow 800% in the next one year and after that it will rise by 7% forever.

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Question: If the firm pays a dividend now of $10, what is the market price?

Note: Please provide reasons to support your answer.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91173266

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