Stocks a and B Have the Same Price and Are

question 73

Multiple Choice

Stocks A and B have the same price and are in equilibrium,but Stock A has the higher required rate of return.Which of the following statements is CORRECT?

• A)If Stock A has a lower dividend yield than Stock B, its expected capital gains yield must be higher than Stock B's.
• B)Stock B must have a higher dividend yield than Stock A.
• C)Stock A must have a higher dividend yield than Stock B.
• D)If Stock A has a higher dividend yield than Stock B, its expected capital gains yield must be lower than Stock B's.
• E)Stock A must have both a higher dividend yield and a higher capital gains yield than Stock B.

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Definitions:

Excitatory Generalization

The process whereby a conditioned response is observed not only to the conditioned stimulus but also to stimuli that are similar to the conditioned stimulus.

Inhibitory Generalization

Inhibitory generalization refers to the process whereby learned inhibition to a certain stimulus is generalized to other similar stimuli.

Stimulus Contrast

The difference in intensity or quality between two stimuli, which can affect perception and behavioral responses.

Generalization Gradient

The generalization gradient is a measure of the degree to which learned behavior is exhibited in response to stimuli that are similar but not identical to the conditioned stimulus.