Which of the following features are advantages of the dividend growth model?
I.Easy to understand
II.Model simplicity
III.Constant dividend growth rate
IV.Model's applicability to all common stocks

Question

Quizplus · Accepted Answer

The dividend growth model has the advantages of being easy to understand and having a simple model, making it accessible to many investors. However, it is not applicable to all common stocks, as some companies may not have a steady or predictable dividend growth rate. Therefore, options B and C are incorrect, and option E is incorrect as it includes the disadvantage of not being universally applicable.

Which of the Following Features Are Advantages of the Dividend