Use of the International CAPM (ICAPM) assures that the WACC will be lower than if a purely domestic market portfolio had been used in the estimation of the cost of equity

Indicate whether the statement is true or false.

Answer: FALSE

Business

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A voidable contract is also termed as an unenforceable contract

Indicate whether the statement is true or false

Business

Use the equation P0 = (K * EPS1 ) /r-g) to demonstrate the relationship between the price-earnings model and the constant growth dividend model

P0 = the current price per share of stock, K = the dividend payout ratio, is the forward looking earnings per share, r is the required rate of return for common stock, and g is the anticipated constant rate of growth.

Business