According to the nonconstant growth model,the discount rate used to find the present value of the expected cash flows during the initial growth period is the same as the discount rate used to find the PVs of cash flows during the subsequent constant growth period.

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The nonconstant growth model assumes a single discount rate is used to discount all expected cash flows, regardless of the period of growth (initial nonconstant or subsequent constant), to find their present value. This is because the discount rate reflects the risk of the overall investment, not the growth rate of dividends or cash flows.

According to the Nonconstant Growth Model,the Discount Rate Used to Find