A decrease in which of the following will increase the current value of a stock according to the dividend growth model?

Question 6 options:

Dividend amount.

Number of future dividends, provided the number is less than infinite.

Dividend growth rate. Discount rate.

Both the discount rate and the dividend growth rate.

Which of the following statements is CORRECT?

Question 7 options:

WACC calculations should be based on the before-tax costs of all the individual capital components.

Since most firms issue stock annually, we should consider floatation costs in computing a firm's cost of equity.

If a company's tax rate increases, then, all else equal, its weighted average cost of capital will decline.

An increase in the risk-free rate will normally lower the marginal costs of both debt and equity financing.