Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  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

Finance

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 2.8%, and the market risk premium is 6.0%. Justus currently sells for $39.00 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 ?) Round your answer to two decimal places. Do not round your intermediate calculations.

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

Finance
1.2K views

Describe how an investor would use the PE ratio model to calculate the value of a...

Operations Management
1.2K views

Fully describe the Japanese Economic Warfare model and its impact.

Electrical Engineering
1.2K views

Create a counter that continuously counts odd numbers backwards (i.e from ‘F’ to ‘0’) and display...

Psychology
1.2K views

(a) Identify the specific type of organizational structure that has been adopted by Brunello Cucinelli (around...

Biology
1.2K views

Which sentence explains how a flood could lead to speciation A It could increase gene...

Physics
1.2K views

28 A portion of electrical network is as shown in figure The energy stored in...

Physics
1.2K views

Solve the following variance problem Kepler s third law of planetary motion states that the...

Basic Math
1.2K views

Apex Motors manufactures luxury cars and sport utility vehicles The most likely customers are high...

Basic Math
1.2K views

Use the basic proportionnecessary.100to solve the following problem for the unknown quantity. Round your answer...

Accounting
1.2K views

How might the data loss at one organization affect other organizations

Accounting
1.2K views

Soudan Inc. reports under ASPE. It has profit from operations after tax of $300,000, including...

Accounting
1.2K views

ta Lopez started Biz Consulting, a new business, and completed the following transactions during its...