Are the following statements True or False.

1. As the time horizon increases, the standard deviation for each forecast of cash flow normally increases. 2. In considering the share price effect on risk-return trade-offs, our goal should always be to earn the highest return possible. 3. In order to reduce risk, one should diversify into areas that are positively correlated with current areas of involvement. 4. Future stock value is equal to Po=D1/(re-9), assuming constant growth in dividends. I 5. In determining the cost of preferred stock, the earnings on outstanding preferred stock may be used as a proxy. 6. The discount rate that equates a future stream of expected dividends to the current price is a good approximation of the cost of common stock. 7. Regardless of the particular source of funds utilized for a project, the required rate of return, or discount rate, will be the weighted average cost of capital. 8. The use of the weighted average cost of capital assumes that the firm is in its optimum capital structure range and the cost of each component stays constant over the range of financing 9. In the capital asset pricing model (CAPM), beta measures the volatility of the market. 10. Under the net present value method, cash flows are assumed to be reinvested at the firm's weighted average cost of capital