CHAPTER 7 QUIZ 16 TO 20

CHAPTER 7  QUIZ 16 TO 20

16. Under a non-constant growth model, the growth rate (g) is varied from time period
to time period.

17. Under a non-constant growth model, Ke (required rate of return) is varied from time
period to time period

18. Empirical evidence indicates that rising dividends are no guarantee that the
associated common stock price will also rise in the short 

The current price of a stock should equal the future value of the expected dividend
stream.

20. Dividend valuation models are best suited for firms in the expansion or maturity
phase of their life cycle.

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