Question: Which statement is NOT correct? According to DDM, the discount rate should be greater than the growth rate of dividends. As the payout ratio goes
Which statement is NOT correct? According to DDM, the discount rate should be greater than the growth rate of dividends. As the payout ratio goes up, the stock price also goes up. DDM can be used to calculate the terminal value. According to DDM formula, there is a one period lag between the times stock price and the dividend payment. If the payout ratio is fixed, the growth rates of earnings and dividends are the same
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