1- you expect the ibm to hit 120 per share with expected

Reference no: EM13381775

1-) You expect the IBM to hit $120 per share with expected dividends of $2.50 in one year.Its current price is $105 and your research estimates the beta at 1.15 . Market risk premium is .07 and the U.S T-bill is expected to yield .05 .Is the IBM a good investment? Conduct security analysis using the CAPM. Explain your answer.

2-) What would be the intrinsic value of X stock if :

The stock just paid a dividend of $3 and it will grow 5% annually for the next 2 years and will grow 3% thereafter. Assume 8% required rate of return for the stock.

3-)An investor can choose to invest in T-bills paying 5% or a risky portfolio with end-of-year cash flow of$132,000 . If the investor requires a risk premium of 5%, what would she be willing to pay for the risky portfolio?

4-) Discuss concepts covariance and correlation. How do these concepts differ in terms of calculation and interpretation?

5-) Discuss the differences between investors who are risk averse,risk neutral and risk loving.

Reference no: EM13381775

Questions Cloud

1 identify the critical path and its activities for : 1. identify the critical path and its activities for rockfest. how long does the project take what is the duration

The saussy lumber co ships pine flooring to three building : the saussy lumber co. ships pine flooring to three building supply houses from its mills in pineville oak ridge and

How accurate is the political poll when the first lady : how accurate is the political poll? when the first lady hillary rodham clinton and new york city mayor rudolph

Select a company listed on an internationally recognised : select a company listed on an internationally recognised and well established stock exchange see below for choice of

1- you expect the ibm to hit 120 per share with expected : 1- you expect the ibm to hit 120 per share with expected dividends of 2.50 in one year.its current price is 105 and

Topic 1 depreciationdiscuss the difference between the : topic 1 depreciationdiscuss the difference between the straight-line method of depreciation and the accelerated

1 in which of the following situations would get the : 1. in which of the following situations would get the largest reduction in risk by spreading your investment across two

Case study new modes of trade finance trade finance in the : case study new modes of trade finance trade finance in the twenty-first century plug and pay?palate-able delights pad

Calculate the future value of an annuity that has the : calculate the future value of an annuity that has the following characteristics a pmt 1505 b rate 10 and c nper

User Account

All Pages