Chapter Nine Valuation of Common Stocks This chapter contains 47 multiple choice questions,17 short problems,and 9 longer problems. Multiple Choice 1.In a quote listing of stocks,the is defined as the annualized dollar dividend divided by the stock's price,and is usually expressed as a percentage. (a)cash dividend (b)dividend payout (c)dividend coverage (d)dividend yield Answer:(d) 2.According to the discounted-dividend model,the price of a share of stock is the value of all expected dividends per share,discounted at the market capitalization rate. (a)present;current (b)present:future (c)future:future (d)future;current Answer:(b) 3.The value of common stock is determined by which of the following expected cash flows? (a)dividends and interest payments (b)dividends and maturity value of stock (c)dividends and net cash flows from operations of the firm (d)interest payments and maturity value Answer:(c) 9-19-1 Chapter Nine Valuation of Common Stocks This chapter contains 47 multiple choice questions, 17 short problems, and 9 longer problems. Multiple Choice 1. In a quote listing of stocks, the ________ is defined as the annualized dollar dividend divided by the stock’s price, and is usually expressed as a percentage. (a) cash dividend (b) dividend payout (c) dividend coverage (d) dividend yield Answer: (d) 2. According to the discounted-dividend model, the price of a share of stock is the ________ value of all expected ________ dividends per share, discounted at the market capitalization rate. (a) present; current (b) present; future (c) future; future (d) future; current Answer: (b) 3. The value of common stock is determined by which of the following expected cash flows? (a) dividends and interest payments (b) dividends and maturity value of stock (c) dividends and net cash flows from operations of the firm (d) interest payments and maturity value Answer: (c)