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  2. Topic
    Business
  3. Study Set
    Money Banking and Financial Markets
  4. Exam
    Exam 7: The Stock Market, the Theory of Rational Expectations, and the Efficient Market Hypothesis
  5. Question
    In the Gordon Growth Model,a Decrease in the Required Rate
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In the Gordon Growth Model,a Decrease in the Required Rate

Question 4

Question 4

Multiple Choice

In the Gordon growth model,a decrease in the required rate of return on equity


A) increases the current stock price.
B) increases the future stock price.
C) reduces the future stock price.
D) reduces the current stock price.

Correct Answer:

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