1. The current value of a stock is an estimate of

A.future earnings and future P/E ratios.

B.the present value of future dividends and the future price of the stock.

C.all future dividends discounted at the required rate of return minus the growth rate.

D.the stock's future beta and the future market rate of return.

2.The free cash flow to equity approach does not require present value calculations.

True

False

3. A comparison of commonsize income statements in consecutive years will show a change in profit margin, but not a change in revenues

True

False