Stock X Has a Required Return of 10%, While Stock

question 25

Multiple Choice

Stock X has a required return of 10%, while Stock Y has a required return of 12%. Which of the following statements is correct?

• A) If the market is in equilibrium, and if Stock Y has the LOWER expected dividend yield, then it must have the HIGHER expected growth rate.
• B) If Stock X and Stock Y have the same current dividend and the same expected dividend growth rate, then Stock Y must sell for a higher price.
• C) The stocks must sell for the same price.
• D) Stock Y must have a higher dividend yield than Stock X.

Understand the requirements for dimensioning datum target lines.

Comprehend the relationship between primary, secondary, and tertiary datums when using targets.

Know the number of target points or areas needed for flat surface primary datums.

Acknowledge the impact of datum target placement on measurement accuracy.

---

Definitions:

Equity

The value of an owner's interest in a property or business, calculated as the difference between the total assets and total liabilities.

Liabilities

Liabilities are obligations arising from past transactions expected to lead to an outflow of resources embodying economic benefits.

Accounting Equation

Represents the foundational principle of double-entry bookkeeping, stating that assets equal liabilities plus equity, serving as the basis for all accounting systems.

Liabilities

Financial obligations or debts that a company owes to others, which are recorded on the right side of the balance sheet.