If Two Firms Have the Same Expected Earnings Per Share

question 64

True/False

If two firms have the same expected earnings per share (EPS)and the same standard deviation of expected EPS,then they must have the same amount of business risk.

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Definitions:

Mnemonic Devices

memory aids or strategies that use associations, such as patterns, rhymes, or similarities, to enhance the recall of information.

Semantic Network Model

A theory that proposes concepts are stored in the brain in a network of connected ideas, facilitating understanding and retrieval of information.

Physically Proximal

denotes being in close physical or spatial relationship to something or someone.

Nondeclarative Memory

A type of long-term memory that enables people to perform tasks without conscious awareness of previous experiences, including skills and habits.