What is intrinsic value and how is it used to make a buy or sell decision? What is ratio analysis? Explain the major type of ratio analysis. What are the limitations of using the Dividend Discount Model to determine intrinsic value? Explain the stock valuation methods that can be used when a company does not pay dividends or when dividends are hard to forecast. Describe the variations in calculating a P/E ratio. If you bought a share of common stock, you would probably expect to receive dividends plus a eventual capital gain. Would the distribution between the dividend yield and the capital gain yield be influenced by the firm's decision to pay more dividends rather than to retain and reinvest more of its earnings? Explain. What are the variables that affect the P/E ratio? Is the effect direct or inverse for each component?