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Assume you are using the dividend growth model to value stocks. If you expect the inflation rate to increase, you should also expect: A. market
Assume you are using the dividend growth model to value stocks. If you expect the inflation rate to increase, you should also expect:
A. market value of all stocks to decrease, all else equal.
B. stocks that do not pay dividends to decrease in price while dividend paying stocks maintain a constant price.
C. market value of all stocks to remain constant as the dividend growth will offset the increase in inflation.
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