The three simplifying assumptions that cover most share growth patterns are:
A) dividends that stay constant over time, dividends that grow at a constant rate, and dividends that are equal to zero.
B) dividends that have a zero-growth rate, dividends that grow at a varying rate, and dividends that are equal to zero.
C) dividends that stay constant over time, dividends that grow at a constant rate, and dividends that have a mixed growth pattern.
D) dividends that are equal to zero, dividends that grow at a constant rate, and dividends that have a mixed growth pattern.

Question

Quizplus · Accepted Answer

The three simplifying assumptions that cover most share growth patterns are dividends that stay constant over time, dividends that grow at a constant rate, and dividends that have a mixed growth pattern. Option A and B are incorrect because they don't include the assumption of mixed growth rate which is also an important assumption. Option D is incorrect because it doesn't include the assumption of constant dividends. Therefore, option C is the best choice.

The Three Simplifying Assumptions That Cover Most Share Growth Patterns