7 According to the dividend growth model, if a company were to declare that it
would never pay dividends, its value would be
a) Based on earnings.
b) Based on expectations regarding.
c) Higher than similar firms since it could reinvest a greater amoun
MULTIPLE CHOICE QUESTIONS
1 Which of the following is not a consideration in the three-step valuation
a) Analysis of alternative economies
b) Analysis of security markets
c) Analysis of alternative industries
d) Analysis of individual compani
INTRODUCTION TO SECURITY VALUATION
1 The three step valuation process consists of 1) analysis of alternative
and markets, 2) analysis of alternative industries and 3) analysis of industry
2. The financial risk for the retail store industry is difficult to judge because of
t. Corrver‘dble debt.
i. Numerous building leases.
‘f the range.
t. More volatile, low end
i. More volatile, high end
3. Less volatile, low end
J. Less volat
i8. Which of the following is not considered a basic competitive fr
t. Rivalry among erristing competitors
3. Threat of new enu'ants
I. Threat of suhstinrte products
I‘ 1111-1111- .n'F n n1: :I'rrw'rlrrl ﬁ'l'l“ fnd-nv-annnJ-ﬁ
39. Which of the following is
CHAPTER 12MACROANALYSIS AND MICROVALUATION OF THE STOCK MARKET TRUE/FALSE
1. A main limitation of the NBER indicator series is false signals.
2. Stock prices move coincidentally with the economy.
3. The cyclical indicator approach to market analysis
rt. rmancrai stocks use on espectatrons or increases to loan demand, nousmg consuucnons and se
E. Consumer durable stocks rise on expectations of rising consumer conﬁdence and personal incor
C. Capital goods stocks rise on espectation of increa
Ethics and Professional Standards
What is the Purpose of Financial Markets?
EFFICIENT RESOURCE (SAVINGS) ALLOCATION
Why Ethics Matters
Ethics can be defined as set of moral principles or rules of conduct that provide
guidance for our behavior when it affe