HELP with BIWS Advanced Modeling questions

Question: 16 We normally link expenses to revenue, regardless of different scenarios and cases for revenue and revenue growth, and do NOT create different cases for a company's expenses because: Answer Choices: 1) It's not meaningful to calculate EV / EBIT and EV / EBITDA multiples for valuation purposes if the company's margins are changing in the forecast period. 2) Mixing different scenarios for both margins and revenue multiplies the number of cases to analyze and makes it difficult to compare a single Upside case to a Base case or Downside case. 3) We assume that the company's expenses are closely linked to its revenue - if a company isn't growing revenue as quickly then it will also not grow spending as quickly. 4) The Interest Income / (Expense) and D&A may change substantially over time but ordinary business expenses - as a percentage of revenue - will not. 5) Unless the company is in growth mode or a cost-cutting phase the margins shouldn't change dramatically.

Question: 21 Which of the following answer choices are VALID methods of projecting future dividends to be issued by a company? Answer Choices: 1) Assume that the company cuts dividends to $0 in future years because they're not a truly necessary part of spending - unlike CapEx or Working Capital. 2) Take an average of prior years' dividends as a % of net income to determine the average payout ratio and then multiply that by projected net income in each future year. 3) Take an average of historical dividends per share, and then multiply that number by the projected shares outstanding each year. 4) Use the company's own guidance to estimate future dividend payments on a per-share basis. 5) Assume a constant number for dividends going forward, because you don't know which specific line item(s) dividends should be a percentage of.

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