If a Share Is Correctly Priced Then You Know That

question 24

Multiple Choice

If a share is correctly priced then you know that ________.

• A)the dividend payout ratio is optimal
• B)the share's required return is equal to the growth rate in earnings and dividends
• C)the sum of the share's expected capital gain and dividend yield is equal to the share's required rate of return
• D)the present value of growth opportunities is equal to the value of assets in place

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Definitions:

Across Cultures

Refers to phenomena, practices, or situations that occur or are relevant in multiple cultural contexts, emphasizing cross-cultural interactions and understanding.

Ethnic Minority

A group within a country or community which differs from the majority in racial, national, cultural, or linguistic characteristics.

Ethnic Majority

The largest ethnic group within a certain geographical area or society, often holding more power or resources than ethnic minorities.

Cognitive Dissonance

A psychological phenomenon where individuals experience discomfort from holding two or more conflicting beliefs, values, or attitudes.