Which of the Following Is Generally Not True About Leveraged

question 34

Multiple Choice

Which of the following is generally not true about leveraged buyouts?

• A) Borrowed funds are used to pay for all or most of the purchase price, perhaps as much as 90%
• B) Tangible assets of the target firm are often used as collateral for loans.
• C) Bank loans are often secured by the target firm's intangible assets
• D) Secured debt is often referred to as junk bond financing.
• E) C and D only

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Definitions:

Prima Facie Case

Evidence that, unless rebutted, is sufficient to prove a particular proposition or fact in a court of law.

Termination

In a contract, the point at which an offer can no longer be accepted as part of a binding agreement or an offeree no longer has the power to form a legally binding contract by accepting the offer; can occur through revocation by the offeror, rejection by the offeree, death or incapacity of the offeror, destruction or subsequent illegality of the subject matter of the offer, or lapse of time or failure of another condition stated in the offer.

Inference of Discrimination

Inference of discrimination refers to a conclusion drawn from indirect evidence suggesting discriminatory practices based on race, gender, age, or other protected characteristics.

Protected Class

Groups of people legally protected from discrimination by law, based on characteristics such as race, gender, age, or disability.