Rancid Fruit Co. just paid a dividend of $1.00 and expects to increase it at a rate of 5% annually. All else equal, under which of the following conditions would its stock price fall in one year?

A) If the dividend in one year exceeds $1.05
B) If the required return falls
C) If the growth rate increases
D) If its PE ratio increases
E) If its dividend in one year is less than $1.05

E

Business

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