Please see attached, regarding conducting a forecasting analysis. I will also attache the Article required to be utilized when conducting the forecasting.
Once you have read the article “Comparing the Accuracy
and Explainability of Dividend, Free Cash Flow, and Abnormal Earnings Equity
Value Estimates” and Chapters 6 and 7 of your text, review and complete the
questions below. Use the article and your text to inform your responses to the
1. For models 2, 2a, and 2b:
What is the best way to minimize the weighted average cost of capital?
What is the effect of the weighted average cost of capital on the market
2. For models 3, 3a,
What is the relationship between book value of equity and time t-1 and
the market value of the equity?
3. Discuss model 4 and expand on the importance and the meaning of the
market risk premium.
4. In your own words, what are the main conclusions for this article, and
what could be improved upon in its analysis?