Dividend discount model to value common stock

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1. Which of the following is a problem using the dividend discount model to value common stock?

The model does not account for the risk of the stock

The model does not consider the present value of the dividends

The model does not consider that dividends may not be paid

The model does not account for small dividends

2. The dividend model that is most appropriate for a young company that pays small dividends now but is expected to increase dividends in a few years is the

zero-growth model

constant growth model

expansion growth model

multiple growth model

Reference no: EM131866119

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