Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. you are considering an investment in justus corpor

You are considering an investment in Justus Corporation's stock, which is expected to pay a...

90.2K

Verified Solution

Question

Accounting

You are considering an investment in Justus Corporation's stock, which is expected to pay a dividend of $1.50 a share at the end of the year (D1 = $1.50) and has a beta of 0.9. The risk-free rate is 5.6%, and the market risk premium is 4%. Justus currently sells for $47.00 a share, and its dividend is expected to grow at some constant rate, g. Assuming the market is in equilibrium, what does the market believe will be the stock price at the end of 3 years? (That is, what is ?) Do not round intermediate calculations. Round your answer to the nearest cent.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

Identify various types of Dividends. Differentiate between cash dividends and stock dividends. (400 word)

Finance
Q

Since individual motor unites for \"all or none,\" how do skeletal muscles perform smooth movement? Why...

Medical Sciences
Q

https commons wikimedia org wiki File TransOceanus TedicuitC CE gr2 png a Toda Macrobia century...

Biology
Q

When 41 g of water is cooled from 73 C to 40 C how much...

Physics
Q

Find the derivative and simplify y 8x 5 x2 3x y

Basic Math
Q

Let g(y) = (y + 1) (y + 3) (y 9)Use logarithmic differentiation to...

Calculus
Q

6x58x4 3 8x5 6x 3x

Algebra
Q

Tilson Corporation has projected sales and production in...

Accounting
Q

Concrete Works is a California company with a SUTA tax of 5.2% and a SUTA...

Accounting
Q

cedar falls company sells one product last year the company sold 4500 units and incurred...

Accounting
Q

Do you have an SUA 8th edition solution manual?

Accounting
Q

o Required information (The following information applies to the questions displayed below.) The transactions of...

Accounting