Which of the Income Valuation Models Is Based on the Premise

question 24

Multiple Choice

Which of the income valuation models is based on the premise that the market value of ordinary shares represents the sum of the expected future dividend flows, to infinity, discounted to present value?

• A) Earnings- based model
• B) Cash- flow- based model
• C) Dividend- based model
• D) Share- value- based model

---

Definitions:

Linear Regression

A statistical method that models the relationship between a dependent variable and one or more independent variables by fitting a linear equation to observed data.

Regression Analysis

A statistical method for estimating the relationships among variables, often used to predict the value of a dependent variable based on the values of one or more independent variables.

Unknown Value

A value in a dataset or an equation that is not known or has not been determined.

Statistical Method

A collection of mathematical procedures and principles used for analyzing, interpreting, and presenting empirical data.