Which of the following statements are FALSE? A) An investor will be willing to pay up front
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Question:
Which of the following statements are FALSE?
A) An investor will be willing to pay up front to the point at which the current price of a share of stock equals the present value of the expected future dividends and an expected future sale price.
B)The expected total return of a stock should equal the expected return of other investments available in the market with equivalent risk.
C)The toal amount received in dividends and from selling the stock will depend upon the investors investment horizon.
D)if current stock price were greater than Po = div1=P1/(1+rE) it would be a positive NPV investment, and we would expect investors to rush in and buy it, driving up the stock's price'
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