Risk Metrics Company Is Expected to Pay a Dividend of $3.50

question 23

Multiple Choice

Risk Metrics 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 Risk Metrics's stock?

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

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Definitions:

Guilt

A feeling of responsibility or remorse for some offense, crime, wrong, either real or imagined.

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Ten irrational defenses against anxiety that become a permanent part of personality and that affect behavior.

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The condition of being protected from or unlikely to cause danger, risk, or injury.

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Taking unfair advantage of someone or a situation, often for personal gain, at the expense of others' welfare or rights.