Which of the Following Statements Is FALSE

question 82

Multiple Choice

Which of the following statements is FALSE?

• A)Financial transactions are not sources of value,but merely serve to adjust the timing and risk of the cash flows to best suit the needs of the firm or its investors.
• B)The NPV of trading a security in a normal market is zero.
• C)We cannot separate a firm's investment decision from the decision of how to finance the investment.
• D)In normal markets,trading securities neither creates nor destroys value.

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Definitions:

Traveler's Checks

Preprinted, fixed-amount checks designed to allow the person signing them to pay for goods or services in a foreign currency securely.

FDIC

The Federal Deposit Insurance Corporation is a United States government agency that protects depositors in the event of a bank failure, insuring deposits up to a specified limit.

Financial Well Being

A state where an individual has a stable financial condition, able to meet current and future expenses, and feels secure in their financial future.

Government Regulation

Rules established by government aimed at controlling or directing economic or social activities.