Questionable Systematic Risk Company Is Expected to Pay a Dividend

question 72

Multiple Choice

Questionable Systematic Risk Company is expected to pay a dividend of $3.50 in the coming year.Dividends are expected to grow at a rate of 10% per year.The risk-free rate of return is 5% and the expected return on the market portfolio is 13%.The stock is trading in the market today at a price of $90.00.What is the approximate beta of Questionable's stock?

• A) 0.8
• B) 1.0
• C) 1.1
• D) 1.4
• E) none of these