The constant growth Dividend Discount Model (DDM) may be written as _____.

Name: The constant growth Dividend Discount Model (DDM) may be written as _____.
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Question

Quizplus · Accepted Answer

The constant growth Dividend Discount Model (DDM) is represented by D1/(rs - g) where D1 is the expected dividend for the next period, rs is the required rate of return, and g is the constant growth rate. This formula calculates the present value of a stock based on its future dividends. Thus, choice D is the best option as it follows this formula.

The Constant Growth Dividend Discount Model (DDM) May Be Written