As illustrated using the dividend growth model, the total return on a share of common stock is comprised of a ________________.

A) Capital gains yield and a dividend growth rate.
B) Capital gains growth rate and a dividend growth rate.
C) Dividend payout ratio and a required rate of return.
D) Dividend yield and the present dividend.
E) Dividend yield and a capital gains yield.

Dividend Growth Model

A model for valuing a stock by assuming constant, usually non-zero growth in dividends per share.

Capital Gains Yield

The increase in the price of an investment, calculated as the percentage difference between the current price and the purchase price.

Total Return

The overall financial gain or loss on an investment, accounting for both capital gains, dividends, and interest income.