Question
Suppose that in 2020 the expected dividends of the stocks in a broad market index equaled $200 million when the discount rate is 7% and
Suppose that in 2020 the expected dividends of the stocks in a broad market index equaled $200 million when the discount rate is 7% and the expected growth rate of the dividends is 3%. Using the constant-growth formula for valuation, if interest rates decrease to 5%, the value of the market will change by
| A. | 50% | |
| B. | 50% | |
| C. | 100% | |
| D. | -100% |
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On Values In Finance And Ethics Forgotten Trails And Promising Pathways
Authors: Henry Schäfer
1st Edition
3030046834,3030046842
