What Is the Required Return from Truman Planned Community Stock

question 102

Multiple Choice

What is the required return from Truman Planned Community stock if its beta is 1.1,the return on the market portfolio is 12%,the risk free rate is 3%,next year's dividend will be $1.25 per share and dividends are expected to grow 5% per year?

• A) $17.86 per share
• B) $62.50 per share
• C) $53.00 per share
• D) 5.2%
• E) 12.9%

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Definitions:

Context-Based Guesses

The process of making inferences or predictions based on the context surrounding an event or situation.

False Memories

Memories of events that never actually happened or memories that are significantly distorted from the way they actually occurred.

Childhood Exaggerations

The tendency of children to distort reality or overstate facts, often due to an active imagination or a misunderstanding.

Infantile Distortions

Misinterpretations or misunderstandings of reality often exhibited by young children due to their developing cognitive abilities.