Question: Using the constant growth model, an increase in the required rate of return from 1 5 to 1 6 % , combined with an increase

Using the constant growth model, an increase in the required rate of return from 15 to 16%, combined with an increase in the growth rate from 7 to 8%, would cause the price of a constant growth stock, to: (assume the next dividend is $2.00)
A. increase in price.
B. decrease in price.
C. stay the same.
D. not enough information to answer the question.

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