Question: a. State whether True or false? Explain The value of share equals the discounted stream of future earnings per share. b). Consider the following two

a. State whether True or false? Explain The value of share equals the discounted stream of future earnings per share.

b). Consider the following two stocks: a. Stock A is expected to provide a dividend of $10 a share forever. b. Stock B is expected to pay a dividend of $5 next year. Thereafter, dividend growth is expected to be 4% a year forever. If the market capitalization rate for each stock is 10%, which stock is the most valuable? What if the capitalization rate is7%?

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