Which of the Following Is True of Observational Research

question 26

Multiple Choice

Which of the following is true of observational research?

• A)if done carefully, cause and effect conclusions can be drawn
• B)subject reactivity is seldom a problem
• C)results can support a theory, but cannot serve to raise questions about a theory
• D)the descriptive information can provide hypotheses for more controlled studies

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Definitions:

MM Model

Refers to the Modigliani-Miller theorem, which proposes that under certain market conditions and assumptions, the value of a firm is unaffected by its capital structure.

Bankruptcy Risk

The likelihood that a company will be unable to meet its financial obligations and may have to declare bankruptcy.

Debt Financing

Raising funds through borrowing, typically by issuing bonds or taking out loans, which must be repaid at a later date, usually with interest.

Cash Preservation

The practice of managing resources to ensure sufficient liquidity and minimize financial risk.