Lecture 5, problem set Flashcards
(5 cards)
1
Q
In the Gordon growth model, a decrease in the required rate of return on
equity…
A
A) …increases the current stock price
2
Q
A change in perceived risk of a stock changes…
A
C) …the required rate of return.
3
Q
In the generalised dividend model, if the expected sales price is in the
distant future…
A
A) …it does not affect the current stock price.
4
Q
The coronavirus pandemic led to a decline in stock prices because…
A
A) …of a lowered expected dividend growth rate
5
Q
A
