assignment on stocks 1

  • What are a few differences between common stock and preferred stock? (75–150 words, or 1–2 paragraphs)
  • What makes up the potential total return of a common stock that you purchase? (75–150 words, or 1–2 paragraphs)
  • Why are stocks generally more difficult to value than bonds? (75–150 words, or 1–2 paragraphs)
  • Why might a company choose to not pay dividends? (75–150 words, or 1–2 paragraphs)
  • Under what two assumptions can you use the dividend growth model to determine the value of a share of stock? (150–225 words, or 2–3 paragraphs)
  • Based on the dividend growth model, what are the two components of the total return on a share of common stock? Which do you think is typically larger? (75–150 words, or 1–2 paragraphs)

Note: For each prompt, be sure to reference at least one scholarly source to support your answer. Use the Walden Undergraduate Paper Template, provided in this week’s Learning Resources, to complete this Assignment.