Multiple Choice
What should the price of a share of common stock be according to dividend valuation model if the dividends are expected to stay at $1 per share indefinitely and the investors' discount rate is 5 percent?
A) 1.05
B) 5
C) 10
D) 20
Correct Answer:
Verified
Correct Answer:
Verified
Related Questions
Q85: The cost of raising equity capital should
Q86: The risk encountered by a firm when
Q87: If the net present value (NPV) method
Q88: Which of the following is not an
Q89: A firm has found that the net
Q91: Which of the following is not an
Q92: A firm that uses a discount rate
Q93: A firm can borrow at an interest
Q94: Investment decisions involve costs and revenues that
Q95: According to the dividend valuation model, the