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Which of the Following Statements Is Most Correct

Question 28

Multiple Choice

Which of the following statements is most correct?


A) Assume that the required rate of return on a given stock is 13 percent. If the stock's dividend is growing at a constant rate of 5 percent, its expected dividend yield is 5 percent as well.
B) The dividend yield on a stock is equal to the expected return less the expected capital gain.
C) A stock's dividend yield can never exceed the expected growth rate.
D) All of the answers above are correct.
E) Answers b and c are correct.

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