According to constant growth DDM, the value of a stock increases as:
a. the required rate of return decreases.
b. the required rate of return increases.
c. the dividend growth rate increases.
d. both a and c are correct.
Stock price, P0 = D1÷(r-g)
D1 is next expected dividend
r is required return
g is growth rate
From the above formula we can say that correct option is B
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According to constant growth DDM, the value of a stock increases as: a. the required rate...
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