The Constant Dividend Growth Model: I

Multiple Choice

The constant dividend growth model: I. assumes that dividends increase at a constant rate forever.
II) can be used to compute a stock price at any point of time.
III) states that the market price of a stock is only affected by the amount of the dividend.
IV) considers capital gains but ignores the dividend yield.

A) I only
B) II only
C) III and IV only
D) I and II only
E) I, II, and III only