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The two-step DDM (or Dividend Discount Model) assumes:

Assertion 1) that at some point a company will begin paying dividends that grow at a constant rate. Assertion 2) Prior to that point in time, the company will pay dividends that grow at a rate greater than the rate that can be sustained over the long term.

A) Both statements are true B) Only one of the statements is true C) Both statements are false