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1) A firm has positive free cash flow and a net dividend to shareholders that is less than free cash flow. What must it do

1) A firm has positive free cash flow and a net dividend to shareholders that is less than free cash flow. What must it do with the surplus of the free cash flow over the dividend ?

2) P/B ratio is often said to indicate a growth stock. Explain under which situation a firm with high P/B can be a zero growth firm.

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