The Expected Return Depends on Future Dividends and Future Price

question 31

True/False

The expected return depends on future dividends and future price appreciation.

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Definitions:

Cumulative Preferred Stock

Stock that entitles its holders to any undeclared dividends that have accumulated before common stockholders receive their dividends.

Cash Dividends

A disbursement of profits from a company to its owners or investors, usually as a profit-sharing mechanism.

Common Stock

Common Stock represents units of ownership in a corporation, giving holders voting rights and a share in the company's profits through dividends.

Asset

An economic resource owned or controlled by an individual, corporation, or country, expected to provide future benefits.