An Advantage of Debt Financing Is That

question 89

Multiple Choice

An advantage of debt financing is that:

• A) it does not require firms to make fixed payments.
• B) it does not require firms to sell stock to new investors to gain additional funds.
• C) it is less risky than equity financing.
• D) it is more flexible than equity financing.

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Definitions:

Delusions of Grandeur

A belief in one's exaggerated sense of importance, power, knowledge, or identity, often found in manic or psychotic conditions.

Visual Hallucinations

Experiences in which someone sees something that does not exist outside their mind, often associated with psychiatric or neurological conditions.

Waxy Flexibility

A symptom of certain psychiatric conditions characterized by a person's limbs remaining in the position they are placed by someone else for an extended period.

Delusion

A firmly held belief that contradicts reality, often occurring as a symptom of mental illness.