老师为什么选c谢谢

问题如下：

Question Which of the following is the most appropriate reason for using a free cash flow to equity (FCFE) model to value equity of a company?

选项：

A.FCFE models provide more accurate valuations than the dividend discount model.

B.A firm’s borrowing activities could influence dividend decisions, but they would not affect FCFE.

C.FCFE is a measure of the firm’s dividend paying capacity.

解释：

C is correct. FCFE is a measure of the firm’s dividend-paying capacity.

A is incorrect. The statement that FCFE models provide more accurate valuations than the dividend discount models is not necessarily true. The appropriateness and the effectiveness of a model depend on the firm characteristics and the analyst’s ability in making predictions.

B is incorrect. A firm’s borrowing activities do impact FCFE, as in the expression:

FCFE = CFO – FCInv + Net borrowing.