Dividend is expected to grow forever at constant rate

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"In the Gordon model, the dividend is expected to grow forever at a constant rate, and this rate is equal to the expected capital gain yield if the stock is priced in equilibrium." True or false?

"Preferred stocks are more risky than bonds; therefore, the yield (before tax) on preferred stocks has been generally higher than that on the corporate bonds." True or false?

"Preferred stock has a fixed amount of dividends that must be paid before dividends can be paid on common stock. A failure to make this payment will surely lead to bankruptcy." True or false?

Reference no: EM131616176

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