Which of the following is true for a constant growth stock whose market value is equal to its intrinsic value? a. The stock's expected return is less the required return. b. The stock's dividend yield is equal to it's growth rate. c. The stock's expected return exceeds the required return. d. The stock's expected and required return are the same.

Respuesta :

Answer:the stocks expected and required return are the same

Explanation:

The true statement regarding when the market value should be equivalent to the intrinsic value is option d.

What is constant growth stock?

It is the stock where the dividend and earnings should be presume to grow at the constant or the same rate. In the case when the market value should be equivalent to the intrinsic value  so here the expected value of the stock and the required return should be the similar.

So based on this, we can say that the option d is correct.

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