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If you want to value a firm but do not want to explicitly forecast its dividends

ID: 2701767 • Letter: I

Question

If you want to value a firm but do not want to explicitly forecast its dividends, what is the simplest model for you to use? a

the discounted free cash flow model b

the dividend-discount model c

the enterprise value model d

None of the above

2. Which one of the following applies to a zero-growth stock? a

The stock price is constant over time. b

The dividend will increase over time. c

The growth rate equals 1.0. d

In the differential growth formula, g2, is the negative of g1.
If you want to value a firm but do not want to explicitly forecast its dividends, what is the simplest model for you to use? If you want to value a firm but do not want to explicitly forecast its dividends, what is the simplest model for you to use? the discounted free cash flow model the dividend-discount model the enterprise value model None of the above

2. Which one of the following applies to a zero-growth stock? a

The stock price is constant over time. b

The dividend will increase over time. c

The growth rate equals 1.0. d

In the differential growth formula, g2, is the negative of g1.
2. Which one of the following applies to a zero-growth stock? 2. Which one of the following applies to a zero-growth stock? The stock price is constant over time. The dividend will increase over time. The growth rate equals 1.0. In the differential growth formula, g2, is the negative of g1. a

the discounted free cash flow model b

the dividend-discount model c

the enterprise value model d

None of the above

2. Which one of the following applies to a zero-growth stock? a

The stock price is constant over time. b

The dividend will increase over time. c

The growth rate equals 1.0. d

In the differential growth formula, g2, is the negative of g1.

Explanation / Answer

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