If the Capital Structure Is Stable, and Free Cash Flows

question 19

True/False

If the capital structure is stable, and free cash flows are expected to be growing at a constant rate at the horizon date, then the horizon value is calculated by discounting the free cash flows plus the expected future tax shields at the weighted average cost of capital.

---

Definitions:

Piaget's Theories

Piaget's theories propose stages of cognitive development in children, describing how they construct a mental model of the world through experiences and interactions.

Cognitive Development

The process of growth and change in intellectual/mental abilities such as thinking, reasoning, and understanding.

Discrete Stages

Distinct and separate phases within a process of development or change, where each stage is characterized by specific criteria that differ from those of other stages.

Deferred Imitation

The ability to reproduce or mimic the behavior of others after a delay, indicating a form of memory and cognitive development.