Which of the following is NOT a limitation of the discounted dividend valuation model (DDM)?

	1.	It cannot be used to value private firms
	2.	It cannot be applied to firms with negative earnings (loss making firms)
	3.	It cannot be applied to firms that never make dividend payments
	4.	It can only be applied to firms with constantly growing dividends

2.

Efficient financial markets imply which of the following statements?

i. Actions that seek to artificially increase earnings per share are ignored in the marketplace.

ii. A security should have one price even if it is traded simultaneously in different markets.

iii. Investors will not reward management for activities that they perform equally well themselves.

	1.	i and ii
	2.	ii and iii
	3.	i, ii, and iii
	4.	i only

3.

Which of the following statements about informational efficiency is TRUE?

	1.	Weak form informational efficiency encompasses the semi-strong form
	2.	Strong form informational efficiency encompasses the semi-strong form
	3.	Strong form informational efficiency does not encompass the weak form
	4.	Semi-strong form informational efficiency encompasses the strong form