Assuming G Will Remain Constant,the Dividend Yield Is a Good

question 30

Multiple Choice

Assuming g will remain constant,the dividend yield is a good measure of the required return on a common stock under which of the following circumstances?

• A) g = 0.
• B) g > 0.
• C) g < 0.
• D) Under no circumstances.
• E) Answers a and b are both correct.

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Definitions:

Discharged

In a legal or financial context, it refers to being freed from a debt, obligation, or liability.

XYZ Corporation

A hypothetical or placeholder name often used to represent a generic, unspecified company or entity in discussions or examples.

Negotiable Instrument

A written promise or order to pay a specific sum of money that can be transferred to another holder.

Indorser

The person who signs and transfers a negotiable instrument, such as a check or promissory note, to another party.