According to the Gordon Growth Model, the price of a stock is directly related to the expected growth rate of earnings.

Name: According to the Gordon Growth Model, the price of a stock is directly related to the expected growth rate of earnings.
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The Gordon Growth Model posits that the price of a stock is directly related to its dividends per share, expected growth rate of these dividends (which can be seen as a reflection of the growth rate of earnings), and the required rate of return by investors.

According to the Gordon Growth Model, the Price of a Stock