If You Want to Value a Firm That Consistently Pays

question 50

Multiple Choice

If you want to value a firm that consistently pays out its earnings as dividends,the simplest model for you to use is the:

• A)enterprise value model.
• B)total payout model.
• C)dividend discount model.
• D)discounted free cash flow model.

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Definitions:

Tethered

To be tied or anchored to a particular point or place, restricting freedom of movement.

Learned Association

A psychological principle where an individual connects two stimuli or a stimulus and a behavior through repeated exposure.

Sensorimotor Stage

The first stage in Piaget's theory of cognitive development, from birth to about 2 years of age, where infants learn about the world through their sensory impressions and motor activities.

Concrete Operational

A stage in Jean Piaget's theory of cognitive development during which children (ages 7-12 approximately) gain a better understanding of mental operations, leading to more logical thoughts about concrete events.