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Business, 15.02.2021 17:10 payshencec21

c). Sure Tool Company is expected to pay a dividend of Ksh.2 in the upcoming year. The risk free rate of return is 4% and the expected return of the market portfolio is 14%. Analysts expect the price of Sure Tool shares to be Shs.22 a year from now. The beta of Sure Tool Company’s stock is 1.25. Required: i). The market’s required rate of return on Sure Tool’s stock. (3 marks) ii). What is the intrinsic value of sure Tool’s stock today? (5 marks) iii). If the intrinsic value is sh.21 today, what must be the growth rate? (3 marks)

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c). Sure Tool Company is expected to pay a dividend of Ksh.2 in the upcoming year. The risk free rat...
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