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

D 1 represents the next expected annual dividend in the constant-growth model. D 1 represents the next expected annual dividend, which is used in the constant-growth model to calculate the stock's present value.

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

D 1 represents the next expected annual dividend in the constant-growth model. D 1 represents the next expected annual dividend, which is used in the constant-growth model to calculate the stock's present value.

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When Valuing a Stock Using the Constant-Growth Model, D₁represents

Question 14

Multiple Choice

When valuing a stock using the constant-growth model, D₁represents 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.

Correct Answer: