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  3. you consider buying shares in a stock which you ex

You consider buying shares in a stock which you expect to hold one year, receiving...

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Basic Math

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You consider buying shares in a stock which you expect to hold one year, receiving a dividend justprior to selling the shares. You have access to an analyst forecast for the stock with a target priceone year from now (P1) after the dividend should be paid.50.51.2561.40.08750.0675Given the analyst's forecast, is the stock over-priced, under-priced, or fairly-priced relative to itsrisk-adjusted expected return?Cannot determine with the information givenFairly-pricedOver-pricedUnder-priced

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