Which of the following statements is NOT CORRECT?

(select all that apply)

Group of answer choices

If a firm goes bankrupt and must be liquidated, and if less money is available than the balance sheet values of bonds, preferred stock, and common equity, then some security holders will receive less than the book values of their investments. The priority system under our bankruptcy laws allocates funds first to preferred stock because of its preference, then to bonds, and then to common stockholders

The capital gains yield is calculated as the dollar amount of the year's dividend payments divided by the current stock price

For the discounted dividend model, you need to know the firm's dividend payments, the dividend growth rate, and the discount rate, or required rate of return. In addition, the model assumes that the firm will only be around for a finite period. The model cannot handle the assumption that there are an infinite number of dividend payments.

Preferred stock is a "hybrid" security. Preferreds typically pay a fixed dividend, so they are a fixed-income security like a bond. However, the directors can omit the preferred dividend without throwing the company into bankruptcy

A stock's price is simply the current market price, and it is easily observed for publicly traded companies. By contrast, intrinsic value, which represents the "true" value of the company's stock, cannot be directly observed and must instead be estimated.