In general,one of the reasons that the constant dividend growth model should not be used for young firms is
A) because young firms have no profits.
B) because young firms have zero growth.
C) because young firms' growth rates are unstable.
D) because young firms grow too fast.

Question

Quizplus · Accepted Answer

Young firms' growth rates are often unstable and difficult to predict, making it challenging to use the constant dividend growth model with any accuracy. Additionally, young firms may not have an established track record of profitability or dividend payouts, making it challenging to estimate future dividends.

In General,one of the Reasons That the Constant Dividend Growth