Question 1 11. e. Which of the following statements is CORRECT? The price of a stock is the present value of all expected future dividends. discounted at the dividend growth rate. O 2.b The stock valuation model. Po-Dilts - ) can be used to value firms whose dividends are expected to decline at a constant rate, i.e. to grow at a negative rate. O 3. If a stock has a required rate of retum ry - 12% and its dividend is expected to grow at a constant rate of 5%, this implies that the stocks dividend yield is also 5%. O 4. e. The constant growth model is often appropriate for evaluating start-up companies that do not have a stable history of growth but are expected to reach stable growth within the next few years. The constant growth model cannot be used for a zero growth stock, where the dividend is expected to remain constant over time. 5. d. Moving to another question will save this response