Question: State whether the following statement is true or false and provide a written explanation of your answer (your answer is limited to eight horizontal lines

State whether the following statement is true or false and provide a written explanation of your answer (your answer is limited to eight horizontal lines drawn on an A4 page in portrait orientation). The Dividend Growth Model (a.k.a Gordon Model) is a ridiculous model to use to value a share. Firstly, it assumes that the company will be around forever, whereas we know that lots of companies will eventually disappear because of takeovers and mergers and this model doesnt allow for that. Secondly, it assumes that dividends grow at the rate of inflation which is not necessarily correct.

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