” In your own word, briefly (2-4 sentences), answer the questions.
QuestionsChoose one question:What is the free cash flow (FCF)? What are the uses of the FCF?
What is the weighted average cost of capital? What factors affect the WACC?
How the FCF and WACC are used to find the value of a firm/stock?
What is the difference between the following two discounted cash flow (DCF) valuation models: free cash flow to the firm (FCFF) and dividend growth (Gordon) model?
Choose one question:What is the terminal value (TV)? How is it used in corporate/stock valuation?
What is a “value stock”? What is a “growth stock”?
How could a firm with negative FCF have a positive value? What are the investors’ future expectations from such a firm?
What are the three factors, explained in The Economist’s article, shared by Netflix, Uber, and Tesla, which help the firms remain afloat while using more than $1bn of FCF a year? Explain briefly.