Which of the following statements is/are CORRECT? O 1) Capital budgeting evaluates timing and risk of future cash flows, except f size of cash flows. O 2) Corporate shareholders have the lowest claim to a firm's cash flows. O 3) The primary goal of financial management is to maximize stock price. O 4) Both a and c are correct. 5) Both b and c are correct.
Which of the following statements is/are CORRECT? O 1) Capital budgeting evaluates timing and risk of future cash flows, except f size of cash flows. O 2) Corporate shareholders have the lowest claim to a firm's cash flows. O 3) The primary goal of financial management is to maximize stock price. O 4) Both a and c are correct. 5) Both b and c are correct.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Which of the following statements is/are CORRECT?
O 11 Capital budgeting evaluates timing and risk of future cash flows, except for
1)
size of cash flows.
O 2) Corporate shareholders have the lowest claim to a firm's cash flows.
3) The primary goal of financial management is to maximize stock price.
4) Both a and c are correct.
O 5) Both b and c are correct.
Expert Solution
Step 1
1. false as the capital budgeting evaluates risk and timing of future cashflow considering the size of the cashflow .
2. true. Corporates shareholder's have lowest claim to firm's cashflows.
3. false. The primary goal of fianacial management is not maximise stock price but tot maximise shareholder's wealth.
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