Which of the following statements are true of preferred stock? More than one answer may be correct. Multiple select question. It does not pay dividends. It pays a constant dividend. It has a fixed maturity. It pays dividends in perpetuity.
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Which of the following statements are true of
It does not pay dividends.
It pays a constant dividend.
It has a fixed maturity.
It pays dividends in perpetuity.
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- Which of the following statements is true about common stock dividends? Multiple choice question. They may grow at a constant rate. They always grow at a differential rate. They always grow at a constant rate. They never grow.Answer the multiple-choice question below: 1. Which of the following is/are incorrect about the characteristics of preferred stock: I.It has a fixed maturity date II.Dividends are tax-deductible III.Dividend payments vary just like common stock IV.Can be easily converted to a number of common stock Select one: a. I and II only b. I only c. I, II, and III only d. All of the aboveThe Dividend-Discount Model (DDM) can only be used to value stocks that are currently paying dividends. True False
- Which of the following is FALSE about preferred stock? Select one: a. the value of a preferred stock can be calculated with the perpetuity formula b. preferred stock are expected to pay the same dividend forever c. preferred stocks are more risky than common stocks d. preferred stocks do not matureWhat information is needed to determine the value of a stock using the zero-growth model? More than one answer may be correct. Multiple select question. Required return Dividends Capital gains Future price of the stockA stock that does not pay a dividend must have a capital gains yield that is equal to the required return. Select one: True False
- What happens to the price of a stock when the stock goes “ex-dividend”? a) it decreases b) it doesn’t change c) it increases d) there is no relationship between dividends and stock pricesWhich of the following statements regarding the dividend discount model for computing stock prices is/are true: I. Non-dividend paying stocks would have a price of zero. II. It assumes the cost of capital is known and constant. O I only Both I and II ONeither I nor II O II only"The dividend discount model is used to find the price of a stock based on the expected dividends received by the shareholder and the discount rate. Therefore, all else constant, the price of a share of stock will increase if the discount rate decreases." A) True B) False
- Please provide answer of question no. 3Evaluate the following statement: When a firm pays dividend, its stock price decreases in the market. Therefore, it is always better to buy a stock on the date of dividend payment.Which of the following statements is FALSE? Select one: O In recent years, an increasing number of firms have replaced dividend payouts with share repurchases. O The price of a share of stock is equal to the present value of the expected future dividends it will pay. O The law of one price implies that to value any security, we must determine the expected cash flows an investor will receive from owning it. O The dividend discount model values the stock based on a forecast of the future dividends paid to shareholders, O An investor might generate cash by choosing to sell the shares at some future date. O Fulture dividend payments and stock prices are not known with certainty: rather these values are based on the investor's expectations at the time the stock is purchased. O The dividend yield is the expected annual dividend of a stock, divided by its expected future sale price. O In the dividend discount model, we implicitly assume that any cash paid out to the shareholders takes the…
