Which of the Statements Below Is FALSE

question 36

Multiple Choice

Which of the statements below is FALSE?

• A)The dividend model requires that a firm have a cash dividend history and that the dividend history shows a constant dividend or a positive growth in dividends.
• B)A problem with using the dividend growth model is that it appears to underestimate the expected return for some stocks.
• C)A problem with using the dividend growth model is that it produces a negative expected return whenever a firm cuts its dividends.
• D)A problem with using the dividend growth model is that it appears to underestimate the expected return for all stocks.

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Definitions:

Short-Term Profits

Earnings achieved within a relatively brief period, reflecting the immediate financial health of a business.

Linear Programming

A mathematical technique used for allocation of resources and optimization of outcomes in decision making, typically involving minimizing costs or maximizing revenues.

Constraint

A limitation or restriction that impacts the performance, process, or execution of a project, activity, or system.

Limitations

The restrictions or constraints that may affect the feasibility or effectiveness of a process, system, or action.