1. True or False : If a stock has a preemptive right, it gives current stockholders the right to purchase any new shares issued by the firm, so as to maintain their level of ownership. This right helps protect current stockholders against both dilution of control and dilution of value.

2. True or False : The total return for a stock can be calculated by taking the dividend yield less the capital gains yield.

3. True or False : To value a stock, you find the future value of future cash flows.