Assumption about market equilibrium

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Suppose that stock L sells for $35 today and is expected to pay a dividend of $1.00 at the end of one year. Firm L's beta is 1.20, the market expected return is 10%, and the riskless return is 3%. Using the CAPM and an assumption about market equilibrium, forecast Firm L's price in one year.

Reference no: EM132035769

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