Expectations of the price of the stock

Assignment Help Business Economics
Reference no: EM131596868

CAPM and Valuation - A share of stock with a beta of .75 now sells for $50. Investors expect the stock to pay a year end dividend of $2. The T-Bill rate is 4%. And the market risk premium is 7% If the stock is perceived to be fairly priced today, what must investors expectations of the price of the stock at the end of the year?

Reference no: EM131596868

Questions Cloud

Monetary and fiscal policy : Explain how monetary policy and fiscal policy are used to regulate economic growth.
What level of growth does company expect for its net sales : What level of growth does the Company expect for its Net Sales for the fiscal year 2015
Discuss technical and administrative security measures : While maintaining our original facility in Boston, the new campus will become the primary location for research and demonstration of equipment and sales.
Fundamental difference between bond portfolio evaluation : Discuss whether there is a fundamental difference between bond portfolio evaluation in a high-interest market versus a low-interest one.
Expectations of the price of the stock : If the stock is perceived to be fairly priced today, what must investors expectations of the price of the stock at the end of the year?
Expected rate of return on the market portfolio : If the risk free rate is 6% and the expected rate of return on the market portfolio is 13%, is a security with a beta
Create your own topic have me approve it : Create your own topic have me approve it. As long as it relates to a specific aspect of pop culture and issues related to it, it is a possible topic!
Two different applications of collaborative technologies : What capabilities do printable technologies have? What is 3D, and what can be done with this technology?
Screening of an adolescent or young adult client : A wellness plan for the adolescent/young adult client, using the three nursing diagnoses you have identified.

Reviews

Write a Review

Business Economics Questions & Answers

  Land assemblage problem

How does building on undeveloped land differ from building on developed land from an economic standpoint? Discuss the land assemblage problem as it relates to urban renewal. List and discuss possible contradictions between the goals of urban renewal ..

  Illustrate economic losses experienced by people

WSJ's Justin Lahars reports that counties throughout the U.S. have seen employment declines that can be attributed to the importing of inexpensive goods from China.

  Making earthmoving equipment is considering investment

A profitable company making earthmoving equipment is considering an investment of $150,000 on equipment that will have a 5 year useful life and a $50,000 salvage value. Use a spreadsheet function to compute the MACRS depreciation schedule.

  Centrally planned command econimy to market-based economy

Which of the following best supports the economic transformation from a centrally planned command econimy to a market-based economy? What kind of organization culture should a business develop in order to foster ethical behavior?

  Compute the decline in consumer surplus

If this tariff is imposed, how much will consumers pay for a pound of tea. What is the quantity demanded. Compute the decline in consumer surplus.

  Assume that treasury is currently running large surpluses

Assume that the treasury is currently running large surpluses (tax collections exceed new government spending). On a S/D diagram show the effect on Treasury Bond markets of using these surpluses to buy back outstanding treasury securities and reduce ..

  What is her marginal rate of substitute

Suppose that the price of good x is $30 and the pice of good y is $30 and a bypothetical consumer has $600 to spend per period on goods x and y. what is her marginal rate of substitute.

  Illustrate what is the new level of gross national debti

Illustrate what is the new level of gross national debti. If 100 percent of the deficit is financed by the sale of securities to federal agencies.

  The total demand for funds curve slopes downward

The total demand for funds curve slopes downward because a rise in the interest rate causes. In the classical view, if government purchases rise (and there is no other fiscal change),

  Would this affect the rate of job separation

A recent strike by the labor unions, in the U.S., led to a huge change in the working environment. As a result, not only were employees provided better working conditions and higher salary, but also guaranteed long term job security. Would this affec..

  What is the current macroeconomic situation

What is the "current macroeconomic situation" in the U.S. (e.g. is the U.S. economy currently concerned about unemployment, inflation, recession, etc.)? What fiscal policies and monetary policies would be appropriate at this time? (Include data)

  Create an ios chart with the investment alternatives

create an ios chart with the investment alternatives alternative a has an irr of 8 and will add 10 million to the

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd