In the generalized dividend valuation model,a stock's value depends only on

Question

Quizplus · Accepted Answer

The generalized dividend valuation model, also known as the Gordon growth model, assumes that a stock's value is determined by its future dividends and the required return on equity. It is calculated as the dividend per share divided by the required return on equity minus the expected dividend growth rate. Therefore, choice B is the correct answer. Option A is incorrect because it does not take into account the required return on equity. Option C is incorrect because it ignores the impact of dividends on the stock's value. Option D is incorrect because it does not consider the required return on equity.

In the Generalized Dividend Valuation Model,a Stock's Value Depends Only