The Primary Advantage of Using the Dividend Growth Model to Estimate

question 37

Multiple Choice

The primary advantage of using the dividend growth model to estimate a company's cost of equity is:

• A) the ability to apply either current or future tax rates.
• B) the model's applicability to all corporations.
• C) is the model's consideration of risk.
• D) the stability of the computed cost of equity over time.
• E) the simplicity of the model.

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