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    Stock Price

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    1) Thames Inc.'s most recent dividend was $2.40 per share (i.e., Do = $2.40). The dividend is expected to grow at a rate of 6% per year. The risk-free rate is 5 percent and the return on the market is 9 percent. If the company's beta is 1.3, what is the price of the stock today?

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    ** Please see the attached file **

    Thames Inc.'s most recent dividend was $2.40 per share (i.e., Do = $2.40). The dividend is expected to grow at a rate of 6% per year. The risk-free rate is 5 percent and the return on the market is 9 percent. If the company's beta is 1.3, what is the price of the stock today?
    First we will ...

    Solution Summary

    Stock price has been calculated using CAPM and Dividend Discount method.

    $2.19

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