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2 answers:
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Answer:
the share should sell at $46
Explanation:
We use the CAPM method to know the required return of the capital
risk free 0.04
market rate 0.1
beta(non diversifiable risk) 2
Ke 0.16000 = 16%
Now we calculate with the dividends grow model the intrinsic value of the share:
$4.6/0.1 = $46