An investor planning to sell stock at the end of two years can still use the DDM to value the stock because the anticipated selling price is:
A) too risky to be considered a variable within the model.
B) irrelevant to the analysis since it does not consider future dividends.
C) built into the model as the selling price in two years would be simply the present value of anticipated dividends.
D) worth little as the present value of the price in two years would be close to zero.
Correct Answer:
Verified
Q9: The variant of the dividend discount model
Q10: Which of the following statements regarding intrinsic
Q11: The intrinsic value of any stock is
Q12: Which of the following statements regarding dividend
Q13: Which of the following is not true
Q15: Which of the following relationships in the
Q16: A firm has net income of $1
Q17: If interest rates rise and other factors
Q18: Which of the following variables does not
Q19: Which of the following changes will likely
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents