Using the Constant Growth Model, an Increase in the Required

question 49

Multiple Choice

Using the constant growth model, an increase in the required rate of return from 14 to 18 percent combined with an increase in the growth rate from 8 to 12 percent would cause the price to

• A) fall more than 4%0
• B) fall less than 4%.
• C) rise more than 4%.
• D) rise less than 4%.
• E) remain constant.

---

Definitions:

Fertilization

The union of male and female gametes (sperm and egg) to form a zygote, initiating the development of a new organism.

Blastodisc

A flattened area of a fertilized egg where cells proliferate during early embryonic development in birds and reptiles.

Holoblastic Cleavage

Holoblastic cleavage refers to a type of embryonic development where the entire egg is evenly divided during cell division, characteristic of many animals including mammals.

Neonate

A newborn baby, especially within the first few weeks after birth.