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What is the cost of common stock

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Reference no: EM132476875

Question 1: The risk-free rate is 5.7%, the market risk premium is 9.2%, and the stock's beta is 1.53. What is the cost of common stock? Use the CAPM Equation.

Note: Convert your answer to percentage and round off to two decimal points. Do not enter % in the answer box.

Question 2: If markets are efficient, the difference between the intrinsic value and the market value of the company's security is:

Group of answer choices

  1. zero
  2. positive
  3. negative

Reference no: EM132476875

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