When valuing a stock using the constant-growth model

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1. When valuing a stock using the constant-growth model, DI represents the:

A. expected difference in the stock price over the next year.

B. expected stock price in one year.

C. last annual dividend paid.

D. the next expected annual dividend.

E. discount rate.

2. Delfino's just paid an annual dividend of $1.50 per share. What is the anticipated dividend for Year 5 if the firm increases its dividend by 2 percent annually?

A. $1.50 (1.02)1

B. $1.50 x (1.02)2

C. $1.50 (1.02)3

D. $1.50 (1.02)4

E. $1.50 x(1.02)5

Reference no: EM131523235


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