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Using the Constant Growth Dividend Valuation Model and Assuming Dividends

Question 92

Multiple Choice

Using the constant growth dividend valuation model and assuming dividends will growth a constant rate forever,the increase in the value of the stock each year should be equal to the


A) growth rate in dividends,g.
B) required return on the stock,rcs.
C) dividend yield plus the capital gains yield.
D) dividend yield.

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