Question

Given the following information from Oriole Corporation, what price would the CAPM predict that the company’s stock will trade for one year from today? (Do not round intermediate calculations. Round final answer to 2 decimal places, e.g. 50.75.) Risk free rate: 3.1 % Market risk premium: 7.6 % Beta: 0.65 Current stock price: $64.55 Annual dividend: $1.93 Price $Entry field with incorrect answer

Answer 1

The required rate of return on equity

According to CAPM, this would be the price of the stock in one year.

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