Solution-Determining the risk-free rate of interest

Determining the risk-free rate of interest

Reference no: EM131419796

Haulin' It Towing Company is selling a stock for $16. The stock just paid a dividend of $.60 and this dividend is expected to grow by 15% per year for three years. After that it will grow at a constant rate of 4%. The stock's beta is 1.7, the risk-free rate of interest is 1.75% and the market risk premium is 5.25%. Should you buy the stock? (Round to dollars and cents or two decimal points)

Reference no: EM131419796

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Determining the risk-free rate of interest

Reference no: EM131419796

Reference no: EM131419796

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