Question

In: Accounting

1)which are correct of these statements . Group of answer choices: a)If a security is underpriced,...

1)which are correct of these statements .

Group of answer choices:

a)If a security is underpriced, then the expected holding period return is above the market capitalization rate.

b)The value of the equity equals the present value of all future payouts (dividends plus repurchases).

c)The value of a share equals the present value of all future dividends per share.

d)If a firm reinvests its earnings at an ROE equal to the market capitalization rate, then its earnings-price (E/P) ratio is equal to the market capitalization rate.

e)The value of a share equals the present value of earnings per share assuming the firm does not grow, plus the NPV of all future investments.

2)which are correct of these statements.

Group of answer choices

a)Everything else equal, the higher the expected dividend growth rate, the higher the P/E ratio.

b)Everything else equal, the higher the plowback ratio, the lower the P/E ratio.

c)Everything else equal, the higher the plowback ratio, the higher the P/E ratio.

d)Everything else equal, the higher the risk of the stock, the lower the P/E ratio.

e)Everything else equal, the higher the risk of the stock, the higher the P/E ratio.

3)Match the stock valuation model from the left column with the cash flows used in that model from the right column.

Group of answer choices

Total Payout Model

   word box: Dividends per share            Free Cash Flow to the Firm            Dividends plus buybacks      

Dividend Discount Model

word box: Dividends per share            Free Cash Flow to the Firm            Dividends plus buybacks      

DCF Model

word box: Dividends per share            Free Cash Flow to the Firm            Dividends plus buybacks      

4)

Match the stock valuation model from the discount rate used in that model from the word bank.

Group of answer choices

Total Payout Model

word box: equity cost of capital            weighted-average cost of capital      

Dividend Discount Model

word box: equity cost of capital            weighted-average cost of capital      

DCF Model

word box: equity cost of capital            weighted-average cost of capital

Solutions

Expert Solution

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

1)Check the correct statements. Group of answer choices a)If a security is underpriced, then the expected...
1)Check the correct statements. Group of answer choices a)If a security is underpriced, then the expected holding period return is above the market capitalization rate. b)The value of the equity equals the present value of all future payouts (dividends plus repurchases). c)The value of a share equals the present value of all future dividends per share. d)If a firm reinvests its earnings at an ROE equal to the market capitalization rate, then its earnings-price (E/P) ratio is equal to the...
Which of the following statements is correct? Group of answer choices None of these is correct....
Which of the following statements is correct? Group of answer choices None of these is correct. The demand for iPads is more elastic than the demand for tablets in general. Here, iPads is one kind of tablets. The demand for a necessity good is more elastic than the demand for a luxury good. The demand for cell phones is more elastic over a short period of time than over a long period of time
Which of the following statements is CORRECT? Group of answer choices 1) The use of debt...
Which of the following statements is CORRECT? Group of answer choices 1) The use of debt financing will tend to lower the basic earning power ratio, other things held constant. 2) A firm that employs financial leverage will have a higher equity multiplier than an otherwise identical firm that has no debt in its capital structure. 3) If two firms have identical sales, interest rates paid, operating costs, and assets, but differ in the way they are financed, the firm...
Which of the following statements is CORRECT? Group of answer choices An increase in the DSO,...
Which of the following statements is CORRECT? Group of answer choices An increase in the DSO, other things held constant, could be expected to increase the ROE. An increase in the DSO, other things held constant, could be expected to increase the total assets turnover ratio. If two firms have the same ROA, the firm with the most debt can be expected to have the lower ROE. The ratio of long-term debt to total capital is less likely to experience...
Which of the following statements is correct? Group of answer choices If a project with normal...
Which of the following statements is correct? Group of answer choices If a project with normal cash flows has an IRR greater than the WACC, the project must also have a positive NPV. A project’s MIRR can never exceed its IRR. If Project A’s IRR exceeds Project B’s, then A must have the higher NPV. If the NPV is negative, the IRR must also be negative. If a project with normal cash flows has an IRR less than the WACC,...
Which of the following statements is CORRECT? Group of answer choices The WACC is not related...
Which of the following statements is CORRECT? Group of answer choices The WACC is not related to the cost of debt or equity capital The WACC will be changing for the changing market value of the shares and debentures The WACC should be the hurdle rate for evaluating all projects The WACC is the expected rate of return for the market
Which of the following statements is(are) correct? Group of answer choices Assume that goods A and...
Which of the following statements is(are) correct? Group of answer choices Assume that goods A and B are substitutes. Suppose a technology improvement in the production of good A and an increase in the price of good B. If everything else remains the same, in the market of good A, the equilibrium price decreases but the effect on the equilibrium quantity depends on the magnitudes of the shifts in supply and demand Assume that goods M and N are complements....
PART 1) Which of the following statements(s) is/are correct? Group of answer choices An weakness of...
PART 1) Which of the following statements(s) is/are correct? Group of answer choices An weakness of SPI is that it does not take into account if the project's critical path is on schedule. It is possible to have a SPI greater than 1.0 while the project is actually behind schedule. An weakness of SPI is that it does not take into account of activites/tasks that have a budgeted cost of zero, such as tasks dealing with submittals and ordering of...
1. Which of the following statements regarding income is correct? Group of answer choices a. All...
1. Which of the following statements regarding income is correct? Group of answer choices a. All increases in net assets are income b. All income increases assets c. All increases in assets are income d. All increases in equity are income e. All income increases equity 2. Which of the following would be considered a breach of the qualitative characteristic of relevance? Group of answer choices a. Omitting details about very complex financial instruments because only a few users would...
QUESTION 1) Which of the following statements is correct? Group of answer choices: a) Logistic regression...
QUESTION 1) Which of the following statements is correct? Group of answer choices: a) Logistic regression extends the idea of linear regression to the situation where the OUTCOME variable is categorical b) Logistic regression extends the idea of linear regression to the situation where a PREDICTOR variable is categorical c) Linear regression extends the idea of logistic regression to the situation where a PREDICTOR variable is categorical d) Linear regression extends the idea of logistic regression to the situation where...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT