An analyst gathers the following information about a company and its common stock: | Expected dividend per share (D₁) | $2 | |----------------------------------|----| | Estimated dividend growth rate | 4% | | Return on equity | 9% | Based on the Gordon growth model, if the required rate of return increases from 8% to 14%, the value of the stock decreases by: | Chartered Financial Analyst Level 1 Quiz - LeetQuiz

An analyst gathers the following information about a company and its common stock:

Expected dividend per share (D₁) $2
Estimated dividend growth rate 4%
Return on equity 9%

Based on the Gordon growth model, if the required rate of return increases from 8% to 14%, the value of the stock decreases by:

Expected dividend per share (D₁)	$2
Estimated dividend growth rate	4%
Return on equity	9%

Exam-Like

Community

LLeetQuiz

Chartered Financial Analyst Level 1

Get started today

Comments

Chartered Financial Analyst Level 1

Get started today

Comments

An analyst gathers the following information about a company and its common stock: Expected dividend per share (D₁)$2Estimated dividend growth rate4%Return on equity9% Based on the Gordon growth model, if the required rate of return increases from 8% to 14%, the value of the stock decreases by: