Which of the Following Statements Is False

question 13

Multiple Choice

Which of the following statements is false?

• A) Future dividend payments and stock prices are not known with certainty; rather these values are based on the investor's expectations at the time the stock is purchased.
• B) The capital gain is the difference between the expected sale price and the purchase price of the stock.
• C) The sum of the dividend yield and the capital gain rate is called the total return of the stock.
• D) We divide the capital gain by the expected future stock price to calculate the capital gain rate.