Which of the Following Statements Is FALSE

question 59

Multiple Choice

Which of the following statements is FALSE?

• A)Total return equals earnings multiplied by the dividend payout rate.
• B)As firms mature, their earnings exceed their investment needs and they begin to pay dividends.
• C)Cutting the firm's dividend to increase investment will raise the share price if, and only if, the new investments have a positive net present value (NPV).
• D)We cannot use the constant dividend growth model to value the shares of a firm with rapid or changing growth.

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Definitions:

Cooperative

Refers to actions or processes undertaken jointly by two or more parties with the objective of mutual benefit.

Empathetic

Possessing the ability to understand and share the feelings of another, showing empathy.

Quality Agreements

Are formal agreements between companies and their suppliers or service providers that detail the standards and quality requirements for products or services.

Identification-based Trust

A form of trust built on the alignment of values and identification with another's intentions and character.