6. You are given the following information for ABC Inc.: (1) The risk-free rate is 5%. (2) The rate of return on the market is 8%. (3) The expected growth rate in dividends is 4%. (4) The last dividend paid was $0.80 per share... (5) Beta is 1.0 a) What price should ABC sell for today? b) What price should ABC sell for, if the growth rate in dividends rise to 6% and beta increases to 1.5.

6. You are given the following information for ABC Inc.: (1) The risk-free rate is 5%. (2) The rate of return on the market is 8%. (3) The expected growth rate in dividends is 4%. (4) The last dividend paid was $0.80 per share... (5) Beta is 1.0 a) What price should ABC sell for today? b) What price should ABC sell for, if the growth rate in dividends rise to 6% and beta increases to 1.5.

Name: 6. You are given the following information for ABC Inc.:(1) The risk-
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Description: 6. You are given the following information for ABC Inc.:(1) The risk-free rate is 5%.(2) The rate of return on the market is 8%.(3) The expected growth rate in dividends is 4%.(4) The last dividend paid was $0.80 per share..(5) Beta is 1.0a) What pr

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 11P

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