Dividend models suggest that the value of a financial asset is ...

[cherise1989]

Dividend models suggest that the value of a financial asset is determined by the ________ the owner is entitled to while holding the asset.
 
  A) present cash flows
  B) past cash flows
  C) future cash flows
  D) past and present cash flows

Question 2

An increase in a firm's market risk should be reflected in what part(s) of the Gordon growth model?
 
  A) The dividend growth rate
  B) The required return
  C) Next year's dividend

[epscape]

Answer to Question 1

Answer: C
Explanation: C) Dividend models do not focus on past and present cash flows but future cash flows, which are discounted by a required rate of return.

Answer to Question 2

B

[cherise1989]

Thanks for the timely response, appreciate it

[apple]

Excellent