Investors use the capm to compute the market capitalization, Financial Management

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Investors use the capm to compute the market capitalization

Smart Investors, Inc., is expected to pay a dividend of $4.20 in the upcoming year. Dividends are expected to grow at the rate of 8% per year. The riskless rate of return is 4% and the expected return on the market portfolio is 14%. Investors use the CAPM to compute the market capitalization rate on the stock, and the constant growth DDM e S at $84.00. Using the constant growth DDM and the CAPM, what is the beta of the stock?

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Financial Management: Investors use the capm to compute the market capitalization

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Financial Management: Investors use the capm to compute the market capitalization

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