Question: Question 2 [3 points] According to the DDM, the current price-earnings ratio (Po/Eo) of a company is high: a. when the risk-free rate is low

Question 2 [3 points] According to the DDM, the current price-earnings

Question 2 [3 points] According to the DDM, the current price-earnings ratio (Po/Eo) of a company is high: a. when the risk-free rate is low b. when the risk premium is low C. if the stock of the company has a high loading on systematic risk d. if the company has fast dividend growth e. if the company has a high plow-back ratio Circle all the wrong statements. For each wrong statement, provide a 2 sentences explanation for why you this the statement is wrong. [Your score on this question depends on how correct and concise your explanation is.] E. (1-b)(1+9 R-9

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