According to the Gordon Growth Model,what Is the Value of a Stock

question 75

Multiple Choice

According to the Gordon growth model,what is the value of a stock with a dividend of $1,required return on equity of 10% and expected growth rate of dividends of 5%?

• A) $2
• B) $10
• C) $20
• D) $21

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Definitions:

Always The Boss

A colloquial term possibly referring to an individual who maintains authority or control in various situations consistently.

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The process of distancing oneself emotionally from others or from a situation, often as a coping mechanism for stress or discomfort.

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The shared values, beliefs, and norms that influence the way individuals within an organization interact with each other and with stakeholders.

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Actions taken within an organization to acquire, develop, and use power and other resources to obtain one's preferred outcomes in a situation where there is uncertainty or disagreement.