Which of the Following Statements Is FALSE

question 13

Multiple Choice

Which of the following statements is FALSE?

• A)If a firm only needs to use the asset for a short time,it is probably less costly to lease it than to buy and resell the asset.
• B)While owners of assets are likely to resell them only if the assets are "lemons," a short-term lease can commit the user of an asset to return it regardless of its quality.In this way,leases can help mitigate the adverse selection problem in the used goods market.
• C)Car dealerships are in a better position to sell a used car at the end of a lease than a consumer is.
• D)If the asset's tax depreciation deductions are faster than its lease payments,there are tax gains from a true tax lease if the lessor is in a lower tax bracket than the lessee.

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Definitions:

International Court of Justice

The principal judicial entity of the United Nations, tasked with settling legal disputes between states and giving advisory opinions on international legal issues.

Swedish Corporation

A company incorporated under the laws and regulations of Sweden, often characterized by specific corporate governance and tax structures.

WTO

World Trade Organization, an international body that deals with the rules of trade between nations to ensure that trade flows as smoothly, predictably, and freely as possible.

Dispute Settlement Board

A panel established to resolve disagreements and disputes in a formal and legally recognized manner, often found in construction contracts or international trade agreements.