Maximizing Enterprise Value and Maximizing Shareholder Value Are Closely Linked

question 32

Multiple Choice

Maximizing enterprise value and maximizing shareholder value are closely linked because:

• A)Enterprise value and shareholder value are the same thing
• B)Shareholder value is calculated by adding debt and other non-equity financial claims to the DCF value of the firm
• C)Shareholder value is calculated by subtracting debt and other non-equity financial claims from the enterprise value of the firm
• D)It is obvious that they must be linked

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Definitions:

Drying Dishes

The act of removing water from washed dishes, typically using a towel or allowing them to air dry, to make them ready for use.

Direct Reinforcer

An immediate reward given to reinforce a desired behavior.

Aggressive Response

An immediate and forceful reaction to a perceived threat or provocation.

Social Learning Theory

A theory proposing that new behaviors can be acquired by observing and imitating others.