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Which of the Following Statements Is FALSE

Question 44

Multiple Choice

Which of the following statements is FALSE?


A) The more cash a firm uses to repurchase shares, the less it has available to pay dividends.
B) Free cash flow measures the cash generated by a firm after payments to debt or equity holders are considered.
C) We estimate a firm's current enterprise value by computing the present value (PV) of the firm's free cash flow.
D) We can interpret the enterprise value of a firm as the net cost of acquiring the firm's equity, taking its cash, and paying off all debts.

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