Stocks X and Y have the following data.Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT? $$\begin{array} { l c c }
& \mathrm { X } & \mathrm { Y } \
\text { Price } & \$ 25 & \$ 25 \
\text { Expected dividend yield } & 5 \% & 3 \% \
\text { Required return } & 12 \% & 10 \%
\end{array}$$
A) Stock X pays a higher dividend per share than Stock Y.
B) One year from now, Stock X should have the higher price.
C) Stock Y has a lower expected growth rate than Stock X.
D) Stock Y has the higher expected capital gains yield.
E) Stock Y pays a higher dividend per share than Stock X.

Question

Stocks X and Y have the following data.Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT? $$\begin{array} { l c c } 
& \mathrm { X } & \mathrm { Y } \
\text { Price } & \$ 25 & \$ 25 \
\text { Expected dividend yield } & 5 \% & 3 \% \
\text { Required return } & 12 \% & 10 \%
\end{array}$$
A) Stock X pays a higher dividend per share than Stock Y.
B) One year from now, Stock X should have the higher price.
C) Stock Y has a lower expected growth rate than Stock X.
D) Stock Y has the higher expected capital gains yield.
E) Stock Y pays a higher dividend per share than Stock X.

Quizplus · Accepted Answer

The Answer of Stocks X and Y have the following data.Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT? $$\begin{array} { l c c } 
& \mathrm { X } & \mathrm { Y } \
\text { Price } & \$ 25 & \$ 25 \
\text { Expected dividend yield } & 5 \% & 3 \% \
\text { Required return } & 12 \% & 10 \%
\end{array}$$
A) Stock X pays a higher dividend per share than Stock Y.
B) One year from now, Stock X should have the higher price.
C) Stock Y has a lower expected growth rate than Stock X.
D) Stock Y has the higher expected capital gains yield.
E) Stock Y pays a higher dividend per share than Stock X.

Stocks X and Y Have the Following Data A) Stock X Pays a Higher Dividend Per Share Than