If a Stock's Dividend Is Expected to Grow at a Constant

question 47

Multiple Choice

If a stock's dividend is expected to grow at a constant rate of 5% a year,which of the following statements is CORRECT? The stock is in equilibrium.

• A)The expected return on the stock is 5% a year.
• B)The stock's dividend yield is 5%.
• C)The price of the stock is expected to decline in the future.
• D)The stock's required return must be equal to or less than 5%.
• E)The stock's price one year from now is expected to be 5% above the current price.

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Definitions:

MAC Address

An exclusive identifier given to network interfaces for interacting over the physical segment of a network.

Unique Number

A distinct numerical identifier that distinguishes one item or entity from another in a specific context or system.

Wireless Network

A networking setup that allows devices to connect and communicate with each other without the need for physical cables, using radio waves or infrared signals.

Printer

A peripheral device that reproduces text and images from a computer onto paper or other physical mediums.