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22. You are considering a stock that just paid a dividend of $2.00, and its...

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22. You are considering a stock that just paid a dividend of $2.00, and its management expects the dividends to grow at 4% forever. If investors require a 12% return, and the stock is tranding at $35 in the open market, one should: a. Buy the stock, since its price is above intrinsic value. b. Buy the stock, since its price is below intrinsic value. c. Sell the stock, since its price is above intrinsic value. d. Sell the stock, since its price is below intrinsic value. 23. Recent unanticipated events in the banking sector included: a. failures of Sillicon Valley and Signature Banks, which in turn increased the fears of a more general banking contagion b. failures of JP Morgan Chase and WElls Fargo Banks, which in turn increased the fears of a more general banking contagion c. both a. and b. d. neither a. or b. 24. True/False: Dividend Discount Model is always the best model to use in all firm valuations. a. TRUE b. FALSE 25. True/False: Free Cash Flow Model is always the best model to use in all firm valuations. a. TRUE b. FALSE

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