Suppose That the Current Dividend for a Stock Is Dtₒdₐᵧ

question 57

Multiple Choice

Suppose that the current dividend for a stock is Dtₒdₐᵧ, the expected dividend growth rate is r, and the interest rate is i. If we ignore risk, which of the following represents the dividend- discount model formula for the fundamental price of a stock?

• A) Dtₒdₐᵧ / (i + g)
• B) (i + g) / Dtₒdₐᵧ
• C) Dtₒdₐᵧ (1 + g) / (i - g)
• D) Dtₒdₐᵧ / (i - g)

---

Definitions:

Promotion

Function of informing, persuading, and influencing a purchase decision.

Identity

The distinctive characteristics or personality of an individual, organization, or brand, which sets it apart from others.

Product Placement

Form of promotion in which marketers pay fees to have their products showcased in various media, ranging from newspapers and magazines to original online television and movies.

The Social Network

A film directed by David Fincher that depicts the founding of the social networking website Facebook and the resulting lawsuits.