which one of the following will increase the price of stock decrease in the require rate...
Homework Answers
The following will increase the price of stock:
a) decrease in the require rate return
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which one of the following will increase the price of stock
decrease in the require rate...
Which of the following will cause the stock price to decrease if you assume that the...
Which of the following will cause the stock price to decrease if you assume that the constant growth pricing model [P(0) = D(1) / (r(s) – g)] is correct: Increase in Dividends Increase in the required rate of return Increase in the growth rate Decrease in the Required Rate of Return and increase in dividends
Which of the following statements is true? O Increasing dividends will always decrease the stock price,...
Which of the following statements is true? O Increasing dividends will always decrease the stock price, because the firm is depleting internal funding resources. O Increasing dividends will always increase the stock price. Increasing dividends may not always increase the stock price, because less earnings may be invested back into the firm and that impedes growth Walter Utilities is a dividend paying company and is expected to pay an annual dividend of $2.05 at the end of the year. Its...
Which of the following would cause the price of equity to decrease according to the dividend...
Which of the following would cause the price of equity to decrease according to the dividend discount model? a. none of the other choices are correct b. an increase in the discount rate c. an increase in expected future dividends d. an increase in the growth rate of expected future dividends
a. The common stock of Russel, Corp. is currently selling at $50 and investors require a...
a. The common stock of Russel, Corp. is currently selling at $50 and investors require a rate of return of 15%. Russel is expected to pay a dividend of $2. At what rate the market would expect Russel's dividends to growth? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Growth Rate = ? b. What will be the price of Russel's common shares if analysts revised its dividend growth rate down to 5%?(Round your answer to...
Which of the following items is not a characteristic of a common stock? a. It offers...
Which of the following items is not a characteristic of a common stock? a. It offers the chance for the firm to remain in business forever b. It gives the owner priority if the firm files for bankruptcy c. It represents a claim against future common dividends d. Its market value is constantly changing e. It represents ownership in the firm Under which of the following circumstances can you not use the DDM to value a stock? a. When the...
Which of the following is true of dividends? O A. Dividends increase assets and decrease total...
Which of the following is true of dividends? O A. Dividends increase assets and decrease total stockholders' equity of a corporation. O B. Dividend payments increase stockholders' equity O C. Dividend payments decrease paid-in capital O D. Dividends are a distribution of cash, stock, or other property to stockholders Click to select your answer 28 MacE esc 名。 FI F2 F3 F4 F5 3
the value of the stock rises or declines so the management should not or should make...
the value of the stock rises or declines
so the management should not or should make the investment and
decreased the dividend
The dividend-growth model, De(1+9) k-9 V= suggests that an increase in the dividend growth rate will increase the value of a stock. However, an increase in the growth may require an increase in retained earnings and a reduction in the current dividend. Thus, management may be faced with a dilemma: current dividends versus future growth. As of now,...
Compute the stock price for a firm that expects to pay a $1.50 dividend in one...
Compute the stock price for a firm that expects to pay a $1.50 dividend in one year and will experience such rapid growth that it expects to increase the dividend by 80% for years 2, 3, and 4. During year 5, however, the dividend growth rate will return to its more normal level of 3.6%. Shareholders in this firm require a 12.9% return.
Which of the following statements is CORRECT? a. A non-dividend paying stock will decline in price...
Which of the following statements is CORRECT? a. A non-dividend paying stock will decline in price over time. b. A non-constant growth stock whose growth rate decreases will decline in price over time. c. A constant growth stock whose growth rate is negative will increase in price over time. d. A constant growth stock whose growth rate is negative will remain at the same price over time. e. A constant growth stock whose growth rate is negative will decline in...
Which of the following will NOT increase a company's dividend payments? O A. It can decrease...
Which of the following will NOT increase a company's dividend payments? O A. It can decrease the number of shares outstanding. OB. It can issue more shares. O c. It can increase its dividend payout rate. OD. It can increase its earnings.
Which of the following statements is true? O Increasing dividends will always decrease the stock price, because the firm is depleting internal funding resources. O Increasing dividends will always increase the stock price. Increasing dividends may not always increase the stock price, because less earnings may be invested back into the firm and that impedes growth Walter Utilities is a dividend paying company and is expected to pay an annual dividend of $2.05 at the end of the year. Its...
Which of the following is true of dividends? O A. Dividends increase assets and decrease total stockholders' equity of a corporation. O B. Dividend payments increase stockholders' equity O C. Dividend payments decrease paid-in capital O D. Dividends are a distribution of cash, stock, or other property to stockholders Click to select your answer 28 MacE esc 名。 FI F2 F3 F4 F5 3
the value of the stock rises or declines
so the management should not or should make the investment and
decreased the dividend
The dividend-growth model, De(1+9) k-9 V= suggests that an increase in the dividend growth rate will increase the value of a stock. However, an increase in the growth may require an increase in retained earnings and a reduction in the current dividend. Thus, management may be faced with a dilemma: current dividends versus future growth. As of now,...
Which of the following statements is CORRECT? a. A non-dividend paying stock will decline in price over time. b. A non-constant growth stock whose growth rate decreases will decline in price over time. c. A constant growth stock whose growth rate is negative will increase in price over time. d. A constant growth stock whose growth rate is negative will remain at the same price over time. e. A constant growth stock whose growth rate is negative will decline in...
Which of the following will NOT increase a company's dividend payments? O A. It can decrease the number of shares outstanding. OB. It can issue more shares. O c. It can increase its dividend payout rate. OD. It can increase its earnings.
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