Question: Please help to explain the reason why it is true or false T F 1. In the context of relative valuation, the PB ratio should

 Please help to explain the reason why it is true or

Please help to explain the reason why it is true or false

false T F 1. In the context of relative valuation, the PB

T F 1. In the context of relative valuation, the PB ratio should always be equal to the EV/Book Value of Capital ratio. (Assume all other inputs stay the same.) T F 2. In the context of the firm DCF valuation model, it is wrong to discount the free cash flows of the firm with the levered cost of equity. T F 3. A two-state one-period binomial option pricing model with PV$1, = 0.50 and PV$1 = 0.00 contains an arbitrage opportunity. T F 4. In the context of binomial option pricing model of valuing a firm's equity and debt, an increase in the maturity of debt will lead to a lower value of the firm's debt. T F 5. The P/S ratio of a company can never turn negative. T F 6. A risk-neutral probability equal to 100% implies that there is no arbitrage. T F 7. In the real world, it is impossible for a business to have a negative enterprise value. T F 8. A corporate bond selling at a premium to its face value implies that it has a negative promised yield-to-maturity. T F 9. A risk-free government bond with an infinite time to maturity will have an infinite modified duration. T F 10. An increase in the uncertainty about the growth rate of a company's future dividends will lead to a lower expected intrinsic value per share today

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