Which of the Following Statements Is False

question 88

Multiple Choice

Which of the following statements is false?

• A) There are two potential sources of cash flows from owning a stock.
• B) An investor will be willing to pay a price today for a share of stock up to the point that this transaction has a zero NPV.
• C) An investor might generate cash by choosing to sell the shares at some future date.
• D) Because the cash flows from stock are known with certainty, we can discount them using the risk-free interest rate.

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Definitions:

Enforcing

The act of compelling compliance or obedience; ensuring that laws, rules, or orders are followed through appropriate actions or measures.

Social Security Benefits

Payments made from the government to eligible individuals, typically retirees or disabled workers, as part of a social insurance program.

Employers

Employers are individuals or businesses that hire and pay employees for services rendered, holding responsibility for providing a safe work environment and complying with labor laws.

Employees

Individuals who work for another person or for a company in return for financial or other compensation.