1. Your friend believes that the CAPM is a better estimator than the constant dividend growth model when estimating the cost of common stock. Do you agree or disagree and why?
2. Is it possible for the discounted period to be shorter than the playback period? Why?

1. Even though it has some bond characteristics , why would it be inappropriate to multiply the cost of preferred stock by (1-T) in the WACC formula?
2. You're company has realized an increase in its current ratio and a drop in its total assets turnover ratio. However, the company's sales quick ratio, and assets turnover ratio have remained constant. what explains these changes?