Question

Part 1: The risk-free rate is 3.53% and the market risk premium is 6.15%. A stock with a β of 0.88 just paid a dividend of $2.36. The dividend is expected to grow at 21.73% for three years and then grow at 4.48% forever. What is the value of the stock?

Part 2: The risk-free rate is 3.35% and the market risk premium is 9.06%. A stock with a β of 0.98 just paid a dividend of $2.28. The dividend is expected to grow at 23.72% for five years and then grow at 3.88% forever. What is the value of the stock?

Round to 2 decimal places please

Answer #1

#1 The risk-free rate
is 1.48% and the market risk premium is 7.25%. A stock with a β of
0.87 just paid a dividend of $1.18. The dividend is expected to
grow at 21.01% for three years and then grow at 3.99% forever. What
is the value of the stock?
#2 The risk-free rate
is 3.17% and the market risk premium is 5.19%. A stock with a β of
1.10 just paid a dividend of $1.07. The dividend is expected...

The risk-free rate is 2.59% and the market risk premium is
8.75%. A stock with a β of 1.32 just paid a dividend of $2.52. The
dividend is expected to grow at 21.52% for three years and then
grow at 3.06% forever. What is the value of the stock?

The risk-free rate is 3.26% and the market risk premium is
5.26%. A stock with a β of 1.69 just paid a dividend of $1.09. The
dividend is expected to grow at 22.69% for three years and then
grow at 4.62% forever. What is the value of the stock?

The risk-free rate is 2.29% and the market risk premium is
9.17%. A stock with a β of 1.14 just paid a dividend of $1.02. The
dividend is expected to grow at 23.43% for five years and then grow
at 4.57% forever. What is the value of the stock?

The risk-free rate is 3.32% and the market risk premium is
7.42%. A stock with a β of 1.18 just paid a dividend of $2.18. The
dividend is expected to grow at 20.43% for three years and then
grow at 4.99% forever. What is the value of the stock?

The risk-free rate is 2.69% and the market risk premium is
8.23%. A stock with a β of 1.29 just paid a dividend of $2.04. The
dividend is expected to grow at 24.18% for three years and then
grow at 4.18% forever. What is the value of the stock?

The risk-free rate is 3.67% and the market risk premium is
5.74%. A stock with a β of 1.37 just paid a dividend of $2.57. The
dividend is expected to grow at 22.77% for three years and then
grow at 3.34% forever. What is the value of the stock?

The risk-free rate is 2.29% and the market risk premium is
6.94%. A stock with a β of 1.50 just paid a dividend of $2.65. The
dividend is expected to grow at 23.33% for three years and then
grow at 4.25% forever. What is the value of the stock?

The risk-free rate is 1.83% and the market risk premium is
7.31%. A stock with a β of 1.50 just paid a dividend of $1.78. The
dividend is expected to grow at 20.80% for five years and then grow
at 4.03% forever. What is the value of the stock?

The risk-free rate is 2.54% and the market risk premium is
9.01%. A stock with a β of 1.27 just paid a dividend of $1.90. The
dividend is expected to grow at 20.78% for three years and then
grow at 3.42% forever. What is the value of the stock?

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