Which of the Following Statements Is FALSE

question 54

Multiple Choice

Which of the following statements is FALSE?

• A)The money taken in by the firm as a result of the share issue exactly offsets the dilution of the shares.
• B)Most analysts prefer to use performance measures and valuation multiples that are based on the firm's earnings before interest has been deducted.
• C)Because the firm's earnings per share and price-earnings ratio are affected by leverage,we can always reliably compare these measures across firms with different capital structures.
• D)In general,as long as the firm sells the new shares of equity at a fair price,there will be no gain or loss to shareholders associated with the equity issue itself.

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Definitions:

Kolmogorov-Smirnov

A nonparametric test used to determine if two sample distributions differ significantly.

Symbol for Summation

A mathematical notation represented by the capital Greek letter sigma (Σ) used to denote the sum of a set of numbers.

Nonparametric

Nonparametric refers to statistical methods that do not assume a specific distribution pattern for the data, making them suitable for data that does not fit normal distribution assumptions.

Distributions

Refers to the way values are spread over a range for a dataset or variable in statistics.