The Current Price of Stock Y Is $12

question 69

Multiple Choice

The current price of Stock Y is $12.It is expected that the stock will pay an annual dividend of $0.60 and sell for $13.50 in one year.The risk-free rate is 6 percent.The expected return on the market portfolio is 14 percent with a standard deviation of 17 percent.Assume the market is in equilibrium.What is the beta of Stock Y?

• A) 0.70
• B) 0.96
• C) 1.25
• D) 1.44

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Definitions:

Target Audience

Refers to a specific group of consumers most likely to want or need a product or service, identified for marketing and product design strategies.

Opportunity Recognition

The process of identifying and analyzing a potentially profitable business venture or investment.

Concept Innovator

An individual or entity that introduces new ideas, thoughts, or methods into a particular field or market, significantly contributing to development and change.

Pro Forma Analysis

A method of financial forecasting that projects future business performance based on presumed events or conditions.