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Dividend valuation models

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Reference no: EM131114214

Microsoft Word - Exam Two

Comment on this statement: "Dividend valuation models (such as the Constant Growth DDM shown below) essentially determine the intrinsic value (present value) of future dividends.

p0=D1/k-g

Therefore, if managers want to make their stock more attractive to investors, they should increase dividends, thus increasing stock price."

Reference no: EM131114214

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