When Applying the Earnings Multiplier Model All of the Following

question 68

Multiple Choice

When applying the earnings multiplier model all of the following will cause the required rate of return,k,to change except

• A) Changes in the real risk free rate
• B) Changes in the retention rate
• C) Changes in the rate of inflation
• D) Changes in the risk premium for common stock
• E) All of the above changes will cause a change in the required rate of return

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