Which of the Following Is Not a Component of the Gordon

question 136

Multiple Choice

Which of the following is not a component of the Gordon (or constant dividend growth rate) model for valuing stocks?

• A)a discount rate that reflects the riskiness of the stock
• B)a constant dividend growth rate
• C)next year's expected earnings
• D)next year's expected dividend

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Definitions:

Average Total Cost

The average expense for each unit of output, calculated by dividing the overall production cost by the total number of units produced.

Average Fixed Cost

The cost that remains constant per unit of output as total production increases or decreases.

Minimum Point

The lowest point on a curve, often related to economic graphs such as cost curves, indicating the least quantity of cost or effort.

Marginal Cost

The additional cost incurred from producing one more unit of a product or service.