8. Consider the constant-growth dividend discount model, P_o = D₁ /(k - g).

Which of the following assumptions does this model require?

I. Dividends grow at a constant rate. II. The required rate of return is larger than the dividend growth rate.

Group of answer choices

I only

I and II

Neither I nor II

II only

9.

A debenture has _________ coupon than secured debt;

and a sinking fund has __________ coupon than one without.

lower; lower

higher; higher

lower; higher

higher; lower

10. Which of the following is TRUE?

I. A firm can go bankrupt for not declaring dividends.

II. Dividend payments are not considered a business expense; therefore, they are not tax deductible.

Group of answer choices

I and II

II only

Neither I nor II

I only