When evaluating a project, the dividend growth model: A. can only be used by firms that pay increasing dividends. B. is relatively simple to use. C. must use the growth rate of the project as the rate of growth in the formula. D. must be used by all dividend-paying firms. E. is only applicable when the growth rate of the project exceeds the dividend growth rate.

Respuesta :

Answer: E. is only applicable when the growth rate of the project exceeds the dividend growth rate.

Explanation:

The dividend growth rate is used to determine the percentage growth rate of the dividend of a stock over a period of time.

It should be noted that when evaluating a project, the dividend growth model will only be applicable when the growth rate of the project exceeds the dividend growth rate.

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