# [Solved] Using the One-Period Valuation Model,assuming a Year-End Dividend of $1

## Using the one-period valuation model,assuming a year-end dividend of $1.00,an expected sales price of $100,and a required rate of return of 5%,the current price of the stock would be

A)$110.00.

B)$101.00.

C)$100.00.

D)$96.19.

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- Q5: In the one-period valuation model,the value of a share of stock today depends upon A)the present value of both the dividends and the expected sales price. B)only the present value of the future dividends. C)the actual value of the dividends and expected sales price received in one year. D)the future value of dividends and the actual sales price.
- Q6: In the one-period valuation model,the current stock price increases if A)the expected sales price increases. B)the expected sales price falls. C)the required return increases. D)dividends are cut.
- Q7: In the one-period valuation model,an increase in the required return on investments in equity A)increases the expected sales price of a stock. B)increases the current price of a stock. C)reduces the expected sales price of a stock. D)reduces the current price of a stock.
- Q8: In a one-period valuation model,a decrease in the required return on investments in equity causes a(n)________ in the ________ price of a stock. A)increase;current B)increase;expected sales C)decrease;current D)decrease;expected sales
- Q9: Using the one-period valuation model,assuming a year-end dividend of $0.11,an expected sales price of $110,and a required rate of return of 10%,the current price of the stock would be A)$110.11. B)$121.12. C)$100.10. D)$100.11
- Q11: In the generalized dividend model,if the expected sales price is in the distant future A)it does not affect the current stock price. B)it is more important than dividends in determining the current stock price. C)it is equally important with dividends in determining the current stock price. D)it is less important than dividends but still affects the current stock price.
- Q12: In the generalized dividend model,a future sales price far in the future does not affect the current stock price because A)the present value cannot be computed. B)the present value is almost zero. C)the sales price does not affect the current price. D)the stock may never be sold.
- Q13: In the generalized dividend model,the current stock price is the sum of A)the actual value of the future dividend stream. B)the present value of the future dividend stream. C)the present value of the future dividend stream plus the actual future sales price. D)the present value of the future sales price.
- Q14: Using the Gordon growth model,a stock's current price will increase if A)the dividend growth rate increases. B)the growth rate of dividends falls. C)the required rate of return on equity rises. D)the expected sales price rises.
- Q15: Using the Gordon growth model,a stock's current price decreases when A)the dividend growth rate increases. B)the required return on equity decreases. C)the expected dividend payment increases. D)the growth rate of dividends decreases.

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