Which of the Following Statements Is FALSE

question 19

Multiple Choice

Which of the following statements is FALSE?

• A) In the method of comparables, we estimate the value of the firm based on the value of other, comparable firms or investments that we expect will generate very similar cash flows in the
• Future.
• B) Consider the case of a new firm that is identical to an existing publicly traded company. If these firms will generate identical cash flows, the Law of One Price implies that we can use the value of the existing company to determine the value of the new firm.
• C) A valuation multiple is a ratio of some measure of the firm's scale to the value of the firm.
• D) Even two firms in the same industry selling the same types of products, while similar in many respects, are likely to be of different size or scale.

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Definitions:

Affordable Care Act

A comprehensive healthcare reform law enacted in March 2010, primarily aimed at increasing healthcare coverage and reducing healthcare costs.

Roe v. Wade

A 1973 Supreme Court decision that legalized abortion nationwide, establishing a woman's legal right to choose abortion under the Fourteenth Amendment.

Political Opinions

The beliefs or viewpoints that individuals hold about political issues, parties, or candidates.

Influencers

Individuals, often found on social media platforms, who have the power to affect the purchasing decisions of others because of their authority, knowledge, position, or relationship with their audience.