An analysts judgment of the future need for new PP&E is not related to expected sales growth.

True or False

Variable costs are directly linked to revenue growth, and may be best modeled as a percentage of revenue or as projected unit volume multiplied by unit variable costs.

true or false

Competitive factors affect a companys ability to raise prices for products and services.

true or false

A bottom-up approach begins at the level of the overall economy.

true or false

For most companies, financial modeling begins with the income statement because most companies derive the majority of their value from future cash flow generation.

true or false

Competitive factors do not affect a companys ability to negotiate lower input prices with suppliers.

true or false

For most companies, the balance sheet and cash flow statement provide an easy, simple, convenient starting point for modeling a companys income statement.

true or false

A good way to model forecasted retained earnings on a pro forma balance sheet would be to take the previous year's balance, add net income, then subtract dividends and other payouts (such as share buybacks).

true or false