How does free cash flow indicate a company's ability to expand operations or pay dividends?

• A. It shows the cash available after necessary investments and dividends, which can be used for expansion or dividend payments.
• B. It shows the total revenue, which can be used for expansion or dividend payments.
• C. It shows the cash available after paying all liabilities, which can be used for expansion or dividend payments.
• D. It shows the net income, which can be used for expansion or dividend payments.

Answer: (A)