Q858
An expected dividend yield is 5.5% and expected rate of return is 11.5% then constant growth rate would be
A.
2.09%
B.
-6.00%
C.
17.50%
D.
6.00%
AnswerAnswer: Option D
Solution
Answer: Option D
Solution:
Constant growth rate = Expected rate of return - Expected dividend yield = 11.5% - 5.5% = 6.00%