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Homework answers / question archive / In theory, the value of a share of common equity is the present value of ____________________________________________________________

In theory, the value of a share of common equity is the present value of ____________________________________________________________

Finance

  1. In theory, the value of a share of common equity is the present value of ____________________________________________________________.
  2. One criticism in using the CAPM to calculate the cost of equity capital is that ______________________________ and the __________________________________________________ are quite sensitive to the time period and methodology used in their computation.
  3. A company with a market beta of 1 has systemic risk ____________________ to the average amount of systemic risk of all equity securities in the market.

 

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  1. In theory, the value of a share of common equity is the present value of ____________________________________________________________.

expected future dividends

  1. One criticism in using the CAPM to calculate the cost of equity capital is that ______________________________ and the __________________________________________________ are quite sensitive to the time period and methodology used in their computation.

market beta
excess market rate return

  1. A company with a market beta of 1 has systemic risk ____________________ to the average amount of systemic risk of all equity securities in the market.

equal