4. True/False. Briefly explain. (2 points each) A. The free cash flow to the firm can be...
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Question:
4. True/False.
Briefly explain. (2 points each)
A. The free cash flow to the firm can be equal to the free cash flow to equity.
B. The free cash flow to the firm is a pre-debt, pre-tax cash flow.
C. The free cash flow to the firm cannot be estimated without knowing interest and principal payments, for a firm with debt.
D. As the uncertainty about the expected cash flows increases, the value of an asset increases.
E. The free cash flow to equity will always be higher than the dividend.
F. The entire free cash flow to equity cannot be paid out as a dividend because some of it has to be invested in new projects.
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