USE THE FOLLOWING INFORMATION TO ANSWER QUESTIONS 21 THROUGH 23 Stock XYZ plans to pay a dividend of $2 per share over the next year, from earnings of $5 per shar ke) of 12% XYZ's return on equity (ROE) is 10%, Further analysis of this stock shoud use ho tonsart arowth model. e. This stock has a required return (cost of equity, or 21. XYZs current fundamental or intrinsic value is: (Circle your answer, 2.5 points) a. above $90 b. between $40 and $50 c between $10 and $20 d. between $30 and $40 22. XYZs current cash cow value is greater than its current fundamental or intrinsic value. (Circle your answer, 2.5 points) a. True b. False 5 c. Uncertain 23. Which of the following accounts for the difference between XYZs current value and its current fundamental or intrinsic value? (Circle your answer, 2 cash cow .5 points) a. ROE is lower than k b. ROE is lower than retention rate C. ROE is lower than dividend payout rate d. XYZ has no cash cow value, as it is not a cash cow 24. Which of the following topics is William Sharpe famously known for? (Circle your answer, 2.5 points) a. Portfolio diversification b. Capital asset pricing and beta c. Cost of capital d. Option pricing 46 47 48 49 50