Stocks X and Y Have the Following Data A) Stock Y Has a Higher Dividend Yield Than Stock

question 97

Multiple Choice

Stocks X and Y have the following data. Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT?
$\begin{array} { l c c } & X& Y \\\text { Price } & \$ 30 & \$ 30 \\\text { Expected growth (constant) } & 6 \% & 4 \% \\\text { Required return } & 12 \% & 10 \%\end{array}$

• A) stock y has a higher dividend yield than stock x.
• B) one year from now, stock x's price is expected to be higher than stock y's price.
• C) stock x has the higher expected year-end dividend.
• D) stock y has a higher capital gains yield.
• E) stock x has a higher dividend yield than stock y.

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