The risk-free interest rate is 8 per cent. The expected return on the market portfolio is 15%. Let's consider A stock wi

Business, Finance, Economics, Accounting, Operations Management, Computer Science, Electrical Engineering, Mechanical Engineering, Civil Engineering, Chemical Engineering, Algebra, Precalculus, Statistics and Probabilty, Advanced Math, Physics, Chemistry, Biology, Nursing, Psychology, Certifications, Tests, Prep, and more.
Post Reply
answerhappygod
Site Admin
Posts: 899603
Joined: Mon Aug 02, 2021 8:13 am

The risk-free interest rate is 8 per cent. The expected return on the market portfolio is 15%. Let's consider A stock wi

Post by answerhappygod »

The risk-free interest rate is 8 per cent.
The expected return on the market portfolio is 15%.
Let's consider A stock with beta 2.
Stock A will pay a dividend of 100 won a year later, and the stock
price is expected to be 1120 won a year later.
What is the current equilibrium price of stock A (under
CAPM)?
Answer in natural numbers.
Join a community of subject matter experts. Register for FREE to view solutions, replies, and use search function. Request answer by replying!
Top
Post Reply

Return to “Archived Questions & Answers”