Stocks X and Y Have the Following Data A) Stock Y Pays a Higher Dividend Per Share Than

question 24

Multiple Choice

Stocks X and Y have the following data. Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT? $\begin{array}{lrr}&\underline{\text {X} }& \underline{\text{Y}}\\ \text { Price } & \$ 25 & \$ 25 \\\text { Expected growth (constant) } & 5 \% & 3 \% \\\text { Required return } & 12 \% & 10 \%\end{array}$

• A) Stock Y pays a higher dividend per share than Stock X.
• B) Stock X pays a higher dividend per share than Stock Y.
• C) One year from now, Stock X should have the higher price.
• D) Stock Y has a lower expected growth rate than Stock X.
• E) Stock Y has the higher expected capital gains yield. D

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Definitions:

Bipolar Disorder

A mental health condition characterized by extreme mood swings that include emotional highs (manias) and lows (depressions).

Cognitive-behavioral Therapy

Cognitive-behavioral Therapy is a form of psychotherapy that treats problems by modifying dysfunctional behaviors, thoughts, and emotions.

Electroconvulsive Therapy

A psychiatric treatment where seizures are electrically induced in patients to provide relief from severe mental diseases, particularly major depressive disorder.

Suicidal

Pertaining to having thoughts, ideations, or tendencies towards ending one’s own life.