The Constant Perpetual Growth Model Assumes The

question 107

Multiple Choice

The constant perpetual growth model assumes the:

• A)dividends are paid for a stated number of years only.
• B)net income is all paid out in dividends.
• C)growth rate is less than the discount rate.
• D)dividends are constant in amount.
• E)discount rate increases at a constant rate.

---

Definitions:

Current Year

The ongoing or present calendar year.

WARP

The Weak Axiom of Revealed Preference (WARP) is a criterion used to check for consistency in consumer choice behavior under the assumption of rationality.

Bundle

A set of goods or services sold together as a single package.

Revealed Preferences

An economic theory that determines consumer preferences by observing their purchasing behavior rather than through direct inquiry.