Assuming g will remain constant, the dividend yield is a good measure of the required return on an ordinary share under which of the following circumstances?

Name: Assuming g will remain constant, the dividend yield is a good measure of the required return on an ordinary share under which of the following circumstances?
Brand: Quizplus
Rating: 4.8 (69 reviews)

Question

Quizplus · Accepted Answer

When g = 0, the dividend yield is equal to the required return on an ordinary share because there is no growth in dividends, making the yield a direct reflection of the return.

Assuming G Will Remain Constant, the Dividend Yield Is a Good