What is the most you should pay for kramerica

Reference no: EM131971089

Question: You are evaluating Kramerica to determine if its stock is a good buy. Kramerica's dividend one year ago was $2.25, and it has a beta 1.25. The market risk premium is currently 8% and T-bills pay 6%. Kramerica enjoys constant dividend growth, and just paid a dividend of $2.34 per share. What is the most you should pay for Kramerica?

Reference no: EM131971089

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