Question: The differential growth model: makes allowance for one change in the discount rate. assumes the second growth rate will be zero. uses Div T +

The differential growth model:

makes allowance for one change in the discount rate.

assumes the second growth rate will be zero.

uses DivT + 1 as the dividend amount throughout the formula.

requires g2 to be less than the discount rate.

assumes the first growth rate will be zero.

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