C6.3. The following formula is oftenused to valueshares,whereEarn, is forward earnings, r is the costof capital,andg isthe

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C6.3. The following formula is oftenused to valueshares,whereEarn, is forward earnings, r is the costof capital,andg isthe expected earnings growth rate.

Y I f

. Earn, a ue0 equity =-r-

g Explain whythisformula can leadto errors.

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Financial Statement Analysis And Security Valuation

ISBN: 9780071267809

4th International Edition

Authors: Penman-Stephen-H, Steven Penman

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Question Posted: Jul 23, 2024 01:01 AM

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C6.3. The following formula is oftenused to valueshares,whereEarn, is forward earnings, r is the costof capital,andg isthe

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Financial Statement Analysis And Security Valuation

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