The Constant Dividend Growth Model Is

question 42

Multiple Choice

The constant dividend growth model is:

• A)generally used in practice because most shares have a constant growth rate.
• B)generally used in practice because the historical growth rate of most shares is constant.
• C)generally not used in practice because most shares grow at a non constant rate.
• D)generally not used in practice because the constant growth rate is usually higher than the required rate of return.
• E)based on the assumption the FTSE 100 represents a good estimate of the market index.

Apply the cost method for investments without significant influence.

Identify the journal entries for buying, selling, and holding investments under different accounting standards (IFRS, ASPE).

Calculate and record gains or losses on the sale of equity investments.

Understand the impact of dividends and net income from an investee on the investor's financial statements.

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Definitions:

Challenge

A task or situation that requires a person to engage in effortful behavior to achieve a specific objective or overcome an obstacle.

Gordon Allport

An influential psychologist known for his theories on personality and for being one of the founders of personality psychology.

Traits

Enduring characteristics or behaviors that differentiate individuals from one another, often considered stable and part of one’s personality.

Brain

The complex central organ of the nervous system responsible for thought, memory, emotion, touch, motor skills, vision, breathing, temperature, hunger, and every process that regulates our body.