Which of the Following Statements Is FALSE

question 27

Multiple Choice

Which of the following statements is FALSE?

• A) The long-run growth rate g_FCF is typically based on the expected long-run growth rate of a firm's revenues.
• B) Since a firm's free cash flow is equal to the sum of the free cash flows from the firm's current and future investments, we can interpret the firm's enterprise value as the total net present value (NPV) that the firm will earn from continuing its existing projects and initiating new ones.
• C) If a firm has no debt, then r_wacc equals the risk-free rate of return.
• D) When using the discounted free cash flow model, we forecast a firm's free cash flow up to some horizon, together with some terminal (continuation) value of the enterprise.

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Definitions:

Supply Chain

A composite of enterprises, participants, procedures, information, and instruments implicated in the conveyance of a product or service from the vendor to the patron.

Lost Sales

Potential sales that cannot be realized due to stockouts, inadequate inventory, or other operational issues.

Retailers

Retailers are businesses or individuals that sell goods directly to consumers, acting as the final link between manufacturers and the consuming public.

Transportation

The action of moving goods or people from one place to another using vehicles, vessels, or other means.