Calculate the intrinsic value of Rio Tinto in each of the following scenarios by using the three-stage growth model of Spreadsheet 18.1. Treat each scenario independently. a. The terminal growth rate will be 11.50%. (Round your answer to 2 decimal places.) Intrinsic value b. Rio Tinto's actual beta is 1.06. (Round your answer to 2 decimal places.) Intrinsic value c. The market risk premium is 10.70%. (Round your answer to 2 decimal places.) Intrinsic value

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Calculate the intrinsic value of Rio Tinto in each of the following scenarios by using the three-stage growth model of Spreadsheet 18.1.
Treat each scenario independently.
a. The terminal growth rate will be 11.50%. (Round your answer to 2 decimal places.)
Intrinsic value
b. Rio Tinto's actual beta is 1.06. (Round your answer to 2 decimal places.)
Intrinsic value
c. The market risk premium is 10.70%. (Round your answer to 2 decimal places.)
Intrinsic value
Transcribed Image Text:Calculate the intrinsic value of Rio Tinto in each of the following scenarios by using the three-stage growth model of Spreadsheet 18.1. Treat each scenario independently. a. The terminal growth rate will be 11.50%. (Round your answer to 2 decimal places.) Intrinsic value b. Rio Tinto's actual beta is 1.06. (Round your answer to 2 decimal places.) Intrinsic value c. The market risk premium is 10.70%. (Round your answer to 2 decimal places.) Intrinsic value
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