Which one of the following is a correct formula for computing a geometric average dividend growth rate? A)[(1 + D₀)+ (1 + D₁)× (1 + D_N)]^{N + 1} − 1 B)[(1 + D₀)× (1 + D₁)× (1 + D_N)]^N⁻¹ − 1 C)[D_N/D₀]^1/N− 1 D)[D₀/D_N]^N − 1 E)[D_N/D₀]^N/1 − 1

Question

Quizplus · Accepted Answer

The formula for computing a geometric average dividend growth rate is (most commonly): [(D1/D0) * (D2/D1) * ... * (Dn/D(n-1))]^(1/n) - 1, where D0 is the starting dividend, Dn is the ending dividend, and n is the number of periods. This formula is simplified into C, where DS1U1B1N represents the ending dividend and DS1U1B10 represents the starting dividend, and S1U1P11/N represents the number of periods.

Which One of the Following Is a Correct Formula for Computing