Astock’s dividend is expected to grow at a constant rate of 5 percent a year. which of the following statements is most correct?
select one:
a. the expected return on the stock is 5 percent a year.
b. the stock’s dividend yield is 5 percent.
c. the stock’s price one year from now is expected to be 5 percent higher.
d. statements a and c are correct. e. all of the statements above are correct.

Option C      

Explanation:

the correct answer is Option C                                                                    

when the stock's dividend is expected to grow at a constant rate of 5 percent per year then the price of the stock expected to be higher by 5% over the span of one year.

hence, the only option which is correct is option C in which the expected growth is expected to be 5 % after one year.

the answer is a.

by: nicholas dooley

answer; post closing trial balance;