katerin9713 katerin9713

04-11-2022
Business

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the two components of the dividend growth model are the dividend yield and growth rate (capital gains yield). how is the dividend yield calculated in this model? multiple choice question.

Answer :

RupaBera RupaBera

08-11-2022

The dividend yield and the capital gains yield are two components. The yield on capital gains is higher for most businesses.

The two-stage growth model is what?

The two-stage growth model permits two stages of growth: an early phase in which the growth rate is not stable and a following steady state in which the growth rate is stable and is anticipated to stay that way for a long time.

How is the dividend growth model determined?

By dividing the current dividend (Di) by the previous dividend (Di-1) and taking one out of the result, the periodic dividend increase can be calculated and expressed as a percentage.

The dividend yield is calculated using the formula: Dividend Yield = Cash Dividend per Share/Market Price per Share * 100. Let's say a corporation with a share price of 100 rupees announces a dividend of 10 rupees per share. In that scenario, the stock's dividend yield will be 10% (10/100*100).

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