Corp Finance Ch. 8

What is the model called that determines the market value of a stock based on its next annual dividend, the dividend growth rate, and the applicable discount rate? Constants growth model
Which one of following is the rate at which a stock’s price is expected to appreciate? Capital gains yield
National Trucking has paid an annual dividend of $1 per share on its common stock for the past 15 years and is expected to continue paying a dollar a share long into the future. Given this, one share of the firm’s stock is: priced the same as a $1 perpetuity.
A decrease in which of the following will increase the current value of a stock according to the dividend growth model? Discount rate
Which one of the following applies to the dividend growth model? Even if the dividend amount and growth rate remain constant, the value of a stock can vary.
Answer this question based on the dividend growth model. If you expect the market rate of return to increase across the board on all equity securities, then you should also expect: a decrease in all stock values.
Which one of the following types of stock is defined by the fact that it receives no preferential treatment in respect to either dividends or bankruptcy proceedings? Common
You cannot attend the shareholder’s meeting for Alpha United so you authorize another shareholder to vote on your behalf. What is the granting of this authority called? Voting by proxy
The secondary market is best defined as the market: where outstanding shares of stock are resold.
Which one of the following is an electronic system used by the NYSE for directly transmitting orders to designated market makers? Pillar system

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