1. The cash flow approach to analyze whether firms are returning the appropriate amount of cash to stockholders is determined by the Free Cash Flow to the Firm, FCFF. Select one: True False

2. Forcing a firm to make a commitment to pay dividends provides an alternative way of forcing managers to be disciplined in project choice by reducing the cash that is available for discretionary uses. Select one: True False

3. The dividend irrelevance propostion is that stock-holders are indifferent between receiving dividends and earning capital gains (price appreciation); these tradeoff in the absence of taxes or taxing captial gains and dividends at the same rate. Select one: True False