Which of the following statements is FALSE?
A)We can interpret the enterprise value as the net cost of acquiring the firm's equity, taking its cash, and paying off all debts.
B)Free cash flow measures the cash generated by the 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)The more cash the firm uses to repurchase shares, the less it has available to pay dividends.

Question

Quizplus · Accepted Answer

Free cash flow measures the cash generated by the firm after operating expenses and capital expenditures are considered, but before payments to debt or equity holders are made.

Which of the Following Statements Is FALSE