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Market Value

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Which of the following does NOT always increase a company's market value?

a. Increasing the expected growth rate of sales.

b. Increasing the expected operating profitability (NOPAT/Sales).

c. Decreasing the capital requirements (Capital/Sales).

d. Decreasing the weighted average cost of capital.

e. Increasing the expected rate of return on invested capital.

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The solution explains the correct alternative in relation to increase in market value.

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a. Increasing the expected growth rate of sales.
The market value will increase if the profitability ...

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