Which of the Following Statements Is False

question 14

Multiple Choice

Which of the following statements is false?

• A) Because capital expenditures can vary substantially from period to period, most practitioners rely on enterprise value to free cash flow multiples.
• B) Common multiples to consider are enterprise value to EBIT, EBITDA, and free cash flow.
• C) If two stocks have the same payout and EPS growth rates as well as equivalent risk, then they should have the same P/E ratio.
• D) Looking at enterprise value as a multiple of sales can be useful if it is reasonable to assume that the firms will maintain similar margins in the future.

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Definitions:

Surface Cultural

Relating to the visible or easily identifiable aspects of a culture, such as language, dress, or food.

Prevalence

The proportion or frequency at which a particular condition, phenomenon, or behavior occurs in a population at a specific time.

Coherent Document

A document that is logical and consistent in its ideas, structure, and overall message.

Video Conference

A technology-supported conference where participants can see and hear each other through video and audio transmissions over the internet.