Examlex

Solved

Stocks X and Y Have the Following Data A) Stock X Pays a Higher Dividend Per Share Than

question 84

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?
XY Price $25$25 Expected dividend yield 5%3% Required return 12%10%\begin{array} { l c c } & X & Y \\\text { Price } & \$ 25 & \$ 25 \\\text { Expected dividend yield } & 5 \% & 3 \% \\\text { Required return } & 12 \% & 10 \%\end{array}


Definitions:

Price-Weighted Index

A stock market index in which each company's influence on the index's performance is proportional to its stock price.

Bond Price Index

A measure that tracks changes in the prices of a basket of bonds over time, reflecting the overall performance of the bond market.

Equally Weighted Index

A stock market index where each stock has the same weight or importance, regardless of the company's size.

Call Option

A financial contract that gives the buyer the right, but not the obligation, to buy an asset at a specified price within a predetermined time frame.

Related Questions