When Discounting Dividends You Should Use

question 26

Multiple Choice

When discounting dividends you should use:

• A)the weighted average cost of capital.
• B)the after-tax weighted average cost of capital.
• C)the equity cost of capital.
• D)the before-tax cost of debt.

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Definitions:

Novice

A person who is new to the circumstances, work, etc., possessing little experience or skills in a particular field or activity.

Childhood Amnesia

The phenomenon where adults are unable to recall episodic memories from their early childhood, typically before age 3-4.

Elaboration

The addition of more detail to a concept, idea, or instruction, often to facilitate understanding or retention.

Eyewitness

is an individual who directly observes an event and can provide a first-hand account of it.