The beta coefficient of an equity financed corporation equals 1.1 which results in a return...
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The beta coefficient of an equity financed corporation equals 1.1 which results in a return expected by the shareholders of 10.5%. The current price on the corporations stocks is 14 lei. The corporation decides to invest in a new project with a beta of 0.7 which will be financed by 30% of the corporations equity. What is the expected price on the stock before and after implementing the project if the corporations risk premium equals 5.5%?
E(P)I=
E(P)II=
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