Question: 1. Return on Common Equity (ROCE) is defined as: a. DPS/EPS b. EPS/Book Value C. EPS-DPS divided by Book Value 2. Residual Earnings is defined

1. Return on Common Equity (ROCE) is defined as: a. DPS/EPS

1. Return on Common Equity (ROCE) is defined as: a. DPS/EPS b. EPS/Book Value C. EPS-DPS divided by Book Value 2. Residual Earnings is defined as: a. (ROCE-required return) Book Value of Debt b. (ROCE-required return) Book Value of Equity C. (ROCE-required return) Book Value of the Enterprise 3. Normal Forward P/E ratio is defined as:| a. (1+r)/ b. 1/1 c. r/ (1+r) 4. Trailing P/E is defined as: a. (Price+Dividend)/Earnings b. Dividends/Earnings C. Price/Earnings 5. Abnormal Earnings Growth (AEG) is defined as: a. Cumulative dividend earnings-normal earnings b. (EPS+DPS) (1+r) PV of EPS C

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