According to the Gordon-Growth model, what is the value of a stock with a dividend of $1, required return on equity of 10% and expected growth rate of dividends of 5%?
A) $2
B) $10
C) $20
D) $21
D
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Which of the following is a reason for long-run potential growth of real GDP?
A) yearly growth of the labor force B) growth of the stock of physical capital over time C) improvements in technology over time D) all of the above
Aside from being a means of payment, the other functions of money are
A) medium of exchange and the ability to buy goods and services. B) medium of exchange, unit of account, and means of lending. C) pricing, contracts, and store of value. D) medium of exchange, unit of account, and store of value.
In the figure above, international trade ________ total surplus in the United States by ________
A) increases; $1.92 billion B) decreases; $2.56 billion C) increases; $4.8 billion D) decreases; $3.6 billion
J.T. Smith's company, Gamemaker, sells gambling equipment to gaming service companies. Since the quality of the equipment is difficult to monitor and gamblers are often the source of machine failure, Smith could cheat on the level of machine quality. However, Smith has a strong quality assurance program. A primary reason for that may be
A. the asymmetric information Smith holds on quality. B. company reputation. C. the need for reinforcement. D. cost containment.