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The annual dividend paid by a company in a stock index were $16.7% and the investors required a return of 11.4%. the dividends were initially
- The annual dividend paid by a company in a stock index were $16.7% and the investors required a return of 11.4%. the dividends were initially expected to grow at a steady rate of 10% a year. Suppose the expected growth rate of dividends is now changed to 9.6%. based on the dividend growth rate model, how much does the stock index change as a result of the expected change in the dividend growth rate.
- An increase of 21.35
- A decline of 0.043%
- An increase of 16.6%
- A decline of 22.2%
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