Which of the Following Statements Is NOT CORRECT

question 40

Multiple Choice

Which of the following statements is NOT CORRECT?

• A) The corporate valuation model can be used both for companies that pay dividends and those that do not pay dividends.
• B) The corporate valuation model discounts free cash flows by the required return on equity.
• C) The corporate valuation model can be used to find the value of a division.
• D) An important step in applying the corporate valuation model is forecasting the firm's pro forma financial statements.
• E) Free cash flows are assumed to grow at a constant rate beyond a specified date in order to find the horizon,or continuing,value.

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Definitions:

Wagner Act

Also known as the National Labor Relations Act of 1935, this is a foundational statute of US labor law which guarantees the right of private sector workers to organize into trade unions, engage in collective bargaining, and take collective action such as strikes.

Child Labor

The employment of children in any work that deprives them of their childhood, interferes with their ability to attend regular school, and is mentally, physically, socially, or morally harmful.

Interstate Commerce

The exchange of goods, services, or money between states within a country, regulated at the federal level to promote economic equality and efficiency.

Federal Employment Practices

Policies and practices instituted by the federal government to manage, regulate, and oversee the hiring, working conditions, and rights of federal employees.