Stock X Has the Following Data A) the Stock's Required Return Is 10

question 7

Multiple Choice

Stock X has the following data. Assuming the stock market is efficient and the stock is in equilibrium, which of the following statements is CORRECT? $\begin{array}{lr}\text { Expected dividend, } \mathrm{D}_{1} & \$ 3.00 \\\text { Current Price, } \mathrm{P}_{0} & \$ 50 \\\text { Expected constant growth rate } & 6.0 \%\end{array}$

• A) The stock's required return is 10%.
• B) The stock's expected dividend yield and growth rate are equal.
• C) The stock's expected dividend yield is 5%.
• D) The stock's expected capital gains yield is 5%.
• E) The stock's expected price 10 years from now is $100.00.

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