Question

________assumes dividends will remain constant.

Select one:

a. None of the options are correct

b. Gordon growth model

c. Zero growth dividend model

d. Maximum growth model

Answer #1

A zero growth dividend model assumes that the company will pay the same dividend over the life and so growth rate in the dividends will be zero. This means that dividends will remain constant forever.

So, option c is correct.

Gordon growth model assumes that the company's dividend will grow at a constant rate forever. So according to it, when growth rate is greater than zero, dividend will increase and will not remain constant. So, option b is not correct.

Under maximum growth rate model, firm assumes that its profit will continue to increase at a constant maximum rate called sustainable growth rate. So in this model also, dividend will increase. Hence option d is also not a correct answer.

Which of the following statements is most correct? Select
one:
a. The constant growth model is often appropriate for companies
that the dividend growth rate is larger than its required rate of
return on stock.
b. The constant growth model is often appropriate for companies
that never pay dividend.
c. Two firms with the same dividend and growth rate should have
the same stock price.
d. The constant growth model can be applied to companies that
expect zero dividend growth...

Which of the following statements is most correct?
Select one:
a. The constant growth model is often appropriate for companies
that never pay dividend.
b. The constant growth model is often appropriate for mature
companies with a stable history of growth.
c. Two firms with the same dividend and growth rate must also
have the same stock price.
d. The constant growth model cannot be applied to companies that
expect zero dividend growth rate.
e. The constant growth model is...

According to Gordon Growth Model, if investors expect the future
dividends of a company to decline by 1% and require a 4% return on
quity, then the value of its stock must be lower than the current
dividend payment.
Select one: A. True B. False

What is meant by "double taxation of dividends"?
According to the Gordon growth model, an increase in the
required return on equity...
a
increases the future value of the stock.
b
reduces the current dividend.
c
reduces the expected growth rate of the dividend.
d
reduces the value of a stock.

In the constant growth (gordon) model, which of the following
represents the capital gain
a.
the dividend growth rate, g
b.
the dividend just paid, D0
c.
the required rate of return, r
d.
the required rate of return less the dividend growth rate, r -
g

Which of the following statement is true? Select one: a. None of
the options b. A minor can be admitted as a partner only into the
benefits of the partnership. c. A minor cannot be admitted as a
partner d. a minor can be admitted as a partner but his rights
& liabilities are same of the adult partner.

In the Gordon Growth Model, the share price at the beginning of
the second year can be computed as Select one:
a. D3 / (r - g)
b. D2 / (r - g)
c. D1 / (r - g)
d. None of these.

In relation to consumer credit which of the following statements
are correct?
Select one:
a. None of the options.
b. Consumer credit expands future consumption.
c. Consumer credit allows for an increase in future purchasing
power.
d. Consumer credit specifically relates to the use of credit by
individuals and family units for personal needs.

Which of the following is not a problem with the dividend-growth
model:
Select one or more:
a. the discount rate is hard to calculate accurately
b. there are no problems, it is 100% accurate
c. dividend growth rates are hard to predict
d. only works with firms that are paying dividends
e. the market growth rate is a “constant” that doesn’t
change

1. Mark the correct answer.
Select one:
a. The resistivity of a superconductor is infinite.
b. The resistivity of a conductor increases as the temperature
decreases.
c. None of the other options is correct.
d. The electric current is the rate of flow of electric charge,
I=ΔQ/ΔtI=ΔQ/Δt.
2. Mark the correct statement.
Select one:
a. None of the other options is correct.
b. A compass needle must be made out of ferromagnetic
material.
c. A compass needle need not be...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 6 minutes ago

asked 27 minutes ago

asked 37 minutes ago

asked 45 minutes ago

asked 50 minutes ago

asked 56 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago