When Considering the Risk of Receiving Cash Flows, Financial Managers

Multiple Choice

When considering the risk of receiving cash flows, financial managers must be aware that investors _____.

A) want higher returns for perceived greater risk
B) want a lower valued firm to discourage future investors which might dilute their existing control
C) expect dividends and capital gains regardless of the risks associated with achieving them
D) always want lower returns so that the risk is minimized