Which of the Following Statements Is FALSE

question 10

Multiple Choice

Which of the following statements is FALSE?

• A)We must discount the cash flows from stock based on the equity cost of capital for the stock.
• B)The dividend yield is the percentage return the investor expects to earn from the dividend paid by the stock.
• C)The firm might pay out cash to its shareholders in the form of a dividend.
• D)The dividend yield is the expected annual dividend of a stock,divided by its expected future sale price.

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Definitions:

Unit Cost

The calculated cost to produce one unit of a product, taking into account all relevant production expenses.

Technological Advance

The progress in technological development that leads to more efficient processes, products, or services.

Productive Capital

Resources such as machinery, tools, and buildings used in production to generate wealth.

MP/P

The ratio of marginal product to price, often used to optimize production levels in economic analysis.