true/false

1,In the context of the economic value added (EVA) firm valuation model, it is assumed that the firm will keep its leverage ratio constant in perpetuity.

Group of answer choices

2,A two-state one-period binomial option pricing model with PV$1_u = $1.00 and PV$1_d = $1.00 does not contain an arbitrage opportunity.

3,A risk-neutral probability equal to 100% implies that there is an arbitrage opportunity.

4,A risk-free government bond with an infinite time to maturity will have an infinite duration and convexity measure (assuming a positive risk-free rate).

5,In the context of the binomial option pricing model for valuing a firm's equity and debt, an increase in the time to maturity will lead to a lower value of the firm's debt.