When deducing the cost of equity through a dividend model, must we assume either a constant level

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When deducing the cost of equity through a dividend model, must we assume either a constant level of future dividends or a constant level of growth of dividends? Explain your response.

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Business Finance

ISBN: 9781292134406

11th Edition

Authors: Eddie McLaney

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Question Posted: Mar 05, 2024 06:37 AM

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When deducing the cost of equity through a dividend model, must we assume either a constant level

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No These are both simplifying assumptions one of which it is often expedient to make Other assumptions could be made Future dividends are difficult to predict so a simple assumption ...View the full answer

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