When Considering the Risk of Receiving Cash Flows, Financial Managers

question 15

Multiple Choice

When considering the risk of receiving cash flows, financial managers must be aware that investors _____.

• A) want higher returns for perceived greater risk
• B) want a lower valued firm to discourage future investors which might dilute their existing control
• C) expect dividends and capital gains regardless of the risks associated with achieving them
• D) always want lower returns so that the risk is minimized

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Definitions:

Contingency Planning

Plans that allow a firm to resume operations as quickly and as smoothly as possible after a crisis while openly communicating with the public about what happened.

3G Services

The third generation of mobile telecommunications technology, offering improved data transfer rates over previous generations.

4G Services

4G services are the fourth generation of mobile telecommunications technology, offering higher speed internet and data communication than its predecessor, 3G.

Threat

A potential or actual danger that may cause harm or adverse effects on individuals, assets, or systems.