The cost of capital for common stock is k_e= (D₁/P_o) + g. What are the assumptions of the model? A) Growth (g) is constant to infinity. B) The price earnings ratio stays the same. C) The firm must pay a dividend to use this model. D) All of these are assumptions of the model.

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All of these assumptions are included in the cost of capital for common stock formula. The model assumes a constant growth rate (g), a consistent price-earnings ratio, and the payment of dividends.

The Cost of Capital for Common Stock Is Ke= (D1/Po)

The Cost of Capital for Common Stock Is K_e= (D₁/P_o)