Which of the Following Statements Regarding Value Additivity Is FALSE

question 53

Multiple Choice

Which of the following statements regarding value additivity is FALSE?

• A)The value of a portfolio is equal to the sum of the values of its parts.
• B)The price or value of the entire firm is equal to the sum of the values of all projects and investments within the firm.
• C)To maximize the value of the entire firm,managers should make decisions that maximize NPV.
• D)Value additivity does not have important consequences for the value of the entire firm,only on portfolios of firms.

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Definitions:

Cumulative Percent

Cumulative percent is a statistical term describing the percentage that a given value, or a value smaller than it, has in the total number of values in a dataset.

Arrests

Arrests refer to the act of detaining or capturing someone by legal authority based on an accusation of committing a crime.

Cumulative Percent

The percentage that represents the sum of a category and all categories that are ranked lower in a frequency distribution.

Frequency Distribution

The organization of data into categories or intervals, showing the number of occurrences in each category.