Which One of the Following Is a Common Use of the Statement

question 82

Multiple Choice

Which one of the following is a common use of the statement of cash flows by investors?

• A)To determine if the company can generate enough cash to acquire another company
• B)To determine if the company can generate enough cash to pay cash dividends to stockholders
• C)To determine if the company can generate enough cash to pay its employees
• D)To determine if the company can generate enough cash to buy equipment

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Definitions:

Total Risk

The complete spectrum of all types of risk that an investment or project could potentially face, including both systematic and unsystematic risks.

Expected Return

The expected return is the average return expected on an investment over a period.

Securities

Tradable financial instruments intended to provide returns to investors, which include equities, bonds, and options.

Portfolio

A collection of investments held by an individual or an institution, which may include stocks, bonds, and other assets.