Which of the following statements is NOT true about zero-growth stocks?
A) The dividend payment pattern remains constant over time.
B) The cash flow pattern resembles a perpetuity with a constant cash flow.
C) The dividend pattern grows over time.
D) There is no growth in dividends over time.

Question

Quizplus · Accepted Answer

Zero-growth stocks, as the name suggests, do not experience any growth in dividends over time. Therefore, statement C, which suggests that the dividend pattern grows over time, is not true for zero-growth stocks. Statements A and B are true for zero-growth stocks, while statement D simply reiterates what a zero-growth stock is.

Which of the Following Statements Is NOT True About Zero-Growth