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20-02-2024
Business

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a.Highlight the various assumption that inform Capital Asset Pricing Model as a tool for investment management (6 marks)
b.Differentiate between active and passive investment portfolio management strategy (6 marks)
c.A stock of JEE holdings is currently trading at Sh. 20 and the company is expected to pay a dividend of sh. 1.10, sh. 1.20 and sh. 1.35 on the stock for the next three years. At the end of the third year, the stock can be sold at sh. 34. An investor whose required rate of return is 14 percent is contemplating acquiring this stock. Advise the investor (8 marks)

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