Complete each statement. Do not use acronyms.

1. The required return on Stock A (as calculated by the CAPM) is 10.2%. However, the stocks actual return is 9.5%. This stock would be considered _______________ priced.

2. The total return on common stock can be decomposed into the _____ yield (from dividend payments) and the ____ yield (from changes in a stocks price).

3. Name one assumption that is necessary to use the Dividend Growth Model (DGM)

4. As interest rates increase, present value (and bond price) ______________________.