Which of the Following Statements Is FALSE Regarding Profitable and Unprofitable

question 1

Multiple Choice

Which of the following statements is FALSE regarding profitable and unprofitable growth?

• A) If a firm wants to increase its share price, it must diversify.
• B) If a firm retains more earnings, it will pay out less of those earnings, reducing its dividends.
• C) A firm can increase its growth rate by retaining more of its earnings.
• D) Cutting a firm's dividend to increase investment will raise the stock price if the new investment has a positive net present value (NPV).

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Definitions:

Organization Creation

The process of establishing a new enterprise or entity, including the development of its structure, culture, goals, and strategies.

Critical Information

Vital data or knowledge that is essential for a system or organization to operate effectively and make informed decisions.

Leadership Model

A framework or theory that describes how leaders should act to be effective and facilitate the achievement of organizational goals.

Organizational Performance

Measures how efficiently and effectively an organization meets its goals and objectives, typically evaluated through financial, operational, and strategic metrics.