Which of the Following Is an Accurate Algebraic Expression of the Dividend

question 19

Multiple Choice

Which of the following is an accurate algebraic expression of the dividend discount model? (S₀ is the share price,div₁ is the next year's forecasted dividend per share,r is the discount rate,and g is the dividend growth rate.)

• A)S₀ =div₁ \(\div\) (1 - r - g)
• B)S₀ =div₁ \(\div\) (r - g)
• C)S₀ =div₁ \(\div\) (1 - r + g)
• D)S₀ =div₁ \(\div\) (g - r)

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Definitions:

Activating Event

In cognitive-behavioral therapy, an external situation or internal mental event that triggers a chain of thoughts, emotions, and behaviors.

Cognitive Dissonance

The state of having inconsistent thoughts, beliefs, or attitudes, especially as relating to behavioral decisions and attitude change.

Eustress

A positive form of stress that is perceived as beneficial, motivating, or enhancing to one's functioning.

Predictability

The likelihood of forecasting an event based on current knowledge or patterns.