At what price will the stock reach equilibrium

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Reference no: EM132044476

A share of stock with a beta of 0.70 now sells for $60. Investors expect the stock to pay a year-end dividend of $4. The T-bill rate is 5%, and the market risk premium is 8%.

A. At what price will the stock reach an “equilibrium” at which it is perceived as fairly priced today? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Stock Price: __________

Reference no: EM132044476

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