Given That $P ( E ) = 1$ , What Must Be True About the Event

question 177

Multiple Choice

Given that $P ( E ) = 1$ , what must be true about the event $E$ ?

• A) The event \(E\) is certain.
• B) The event \(E\) is impossible.
• C) The event \(E\) is probable but not certain.
• D) The event \(E\) is possible but not likely.

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Definitions:

WACC

Weighted Average Cost of Capital; a calculation of a firm's cost of capital wherein each category of capital is proportionately weighted.

Cost Of Debt

The current interest rate a business is charged on its outstanding debts, encompassing both loans and bonds.

Dividend Growth Model

A method for valuing a stock by assuming dividends grow at a constant rate in perpetuity.

Cost Of Equity

The return that investors expect for providing capital to a company, often seen as the risk-free rate plus a premium for the equity risk.