As the growth rate of dividends increases, the market price of bank stock will ________, holding all else the same.

Name: As the growth rate of dividends increases, the market price of bank stock will ________, holding all else the same.
Brand: Quizplus
Rating: 4.8 (49 reviews)

Question

Quizplus · Accepted Answer

An increase in the growth rate of dividends typically leads to an increase in the market price of a stock. This is because the present value of future dividends, which investors use to value the stock, increases as the growth rate of these dividends increases.

As the Growth Rate of Dividends Increases, the Market Price