All of the Following Are the Problems Associated to the Dividend

question 17

Multiple Choice

All of the following are the problems associated to the Dividend Discount Model, EXCEPT:

• A) This model need infinite stream of dividends
• B) This model has uncertain dividend stream
• C) This model must estimate future dividends
• D) This model requires constant earnings per share

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Definitions:

Partnership

A legal form of business operation between two or more individuals who share management and profits or losses.

Trading Investments

Securities bought and held primarily for selling them in the short term to profit from price fluctuations.

Fair Value

The estimated market value of an asset or liability, based on current prices in an active market.