Question: Question1. The following information is given for Beta Corp: Recent eamings of $6 Payout ratio of 30% Expected annual growth rate of 5% > Cost

Question1.
The following information is given for Beta Corp:
Recent eamings of $6
Payout ratio of 30%
Expected annual growth rate of 5%
> Cost of equity of 10%
The intrinsic value of the stock is closest to;
Which of the following is a potential weakness of the Gordon growth model?
A.It cannot be used to value broad equity market indices.
B.The model cannot be applied to non-dividend paying stocks
C.It is not applicable for valuing stable and mature dividend-paying

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