Analyze nestle csr initiative plan focuses on society issues
This is a CSR project, and choose to nestle as our company Note: Please give answer on mentioned words (must add intext citation) and required
Consider three stocks
| Beta | Standard deviation | Dividend | Stock price |
Q | 0,45 | 35 % | 0,5 | 45 |
R | 1,45 | 40 % | 0 | 75 |
S | -0,2 | 40 % | 1 | 20 |
Use a risk free rate of 2% and an expected market return of 9.5%. The standard deviation of the market returns is 18%. Assume that the next dividend will be paid after one year, at t= 1.
1. According to CAPM, what is the expected rate of return of each stock and What should today’s price be for each stock, assuming CAPM is correct?