$25.$ Which growth formula is used when valuing FCFE?

a$.$ ROE $\backslash (\backslash$times $\backslash )$ retention ratio

b$.\backslash (\backslash$mathrm$\{$ROC$\}\backslash$times $\backslash )$ retention ratio

c$.$ Non$-$cash ROE $\backslash ($ x $\backslash )$ equity reinvestment rate

d$.$ Non$-$cash ROC $\backslash ($ x $\backslash )$ equity reinvestment rate

$26.$ The stable growth rate can exceed the growth rate of the economy in which a firm operates.

a$.$ True

b$.$ False

$27.$ Potential dividends

a$.$ FCFE

b$.$ FCFF

c$.$ EV

d$.$ EEFF

$28.$ One stage DCF valuation should be used for high growth firms.

a$.$ True

b$.$ False

$29.$ FCFF $\backslash (=\backslash )$ EBIT$(1-$Tax rate$)+$ Depreciation $-$ Capital expenditure $-$ Change in working capital

a$.$ True$4$

b$.$ False

$30.$ When using adjusted valuation approach $($APV$)$ to value a company, we estimate the expected bankruptcy cost by multiplying the probability of bankruptcy by the bankruptcy cost, stated as a percent of levered firm value.

a$.$ True

b$.$ False