You Expect a Share of EconNews

question 84

Multiple Choice

You expect a share of EconNews.Com to sell for $65 a year from now.If you are willing to pay $61.06 for one share of the stock today, you expect a dividend payment of $4, and the rate of return on safe assets is 5%, how much is your risk premium?

• A)1.5%
• B)6.5%
• C)8.0%
• D)13.0%

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Definitions:

Cookie

A small, sweet baked treat, often made with flour, sugar, and butter, and sometimes containing chocolate chips, nuts, or other ingredients.

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A significant monetary penalty imposed as punishment for a violation or infringement of laws or regulations.

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Parking spaces reserved for individuals with disabilities, marked by specific signs.

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A marketing term for a period of time in which a public venue, such as a restaurant or bar, offers discounts on alcoholic drinks and sometimes food.