Equity Investments

CFA Level 2 · 5 questions

Key Takeaways

The largest jump in depth from Level 1: full valuation models (DDM, FCFE/FCFF, relative valuation, residual income) replace the Level 1 overview.
Among the most heavily weighted topics at Level 2.

equity investments1 / 5

Question 1Easy

Which of the following best describes the dividend discount model (DDM)?

A.A valuation model that calculates the present value of all expected future dividend paymentsB.A model used to determine the optimal capital structure of a firmC.A technique for forecasting earnings growth ratesD.A method for calculating the cost of equity using regression analysis

Select an answer and check it