Part I. TRUE OR FALSE. Direction: Before each statement, write TRUE if the statement is correct or FALSE if the statement is incorrect. 1. The wealth of corporate owners is measured by the share price of the stock. 2. Risk and the magnitude and timing of cash flows are the key determinants of share price, which represents the wealth of the owners in the firm. 3. When considering each financial decision alternative or possible action in terms of its impact on the share price of the firm's stock, financial managers should accept only those actions that are expected to maximize shareholder value. 4. An increase in firm risk tends to result in a higher share price since the stockholder must be compensated for the greater risk. 5. Stockholders expect to earn higher rates of return on investments of lower risk and lower rates of return on investments of higher risk