Which of the Following Does NOT Always Increase a Company's

question 15

Multiple Choice

Which of the following does NOT always increase a company's market value?

• A) Increasing the expected operating profitability (NOPAT/Sales).
• B) Decreasing the capital requirements (Capital/Sales).
• C) Decreasing the weighted average cost of capital.
• D) Increasing the expected rate of return on invested capital.
• E) Increasing the expected growth rate of sales.

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Definitions:

Testator's Property

Assets owned by an individual who has made a will, to be distributed after their death.

Per Stirpes

A distribution in which each surviving descendant divides the share that his or her parent would have taken if the parent had survived. Also called by right of representation.

Descendants

Individuals who are the direct blood relatives in the downward line, including children, grandchildren, and so on.

Surviving Descendant

A direct blood relative of a deceased individual, such as a child or grandchild, who is entitled to inherit under the laws of intestacy.