Because of the Overriding Importance of Cash Flows to Valuation,one

question 58

True/False

Because of the overriding importance of cash flows to valuation,one basic tenet of finance is that dividends increase the value of a company's common stock.

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Definitions:

Static Budget

A financial plan that does not change or adjust over the period, even when there are significant changes in the levels of activity.

Variable Costs

Expenses that change in proportion to the level of activity or production volume.

Static Budget

A budget that does not change or adapt over time, based on the assumption of a fixed level of activity.

Activity Index

The activity that causes changes in the behavior of costs.