Which of the Following Statements Is Incorrect

question 12

Multiple Choice

Which of the following statements is incorrect?

• A)the higher the debt levels or leverage,the lower the risk that a company may not be able to meet its debts as they fall due
• B)a company's assets are funded by both owners' equity and external liabilities
• C)the higher the debt levels or leverage,the greater the risk that a company may not be able to meet its debts as they fall due
• D)all of the above

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Definitions:

Rational Basis Test

A standard of judicial review that requires a law to be rationally related to a legitimate government interest.

Means-Ends Test

A method of ethics that evaluates actions by examining the goals they seek to achieve and the means used to achieve those goals.

Full Strict Scrutiny

A legal standard requiring the government to prove that a law or policy is necessary to achieve a compelling state interest and is narrowly tailored to achieve that interest.

Compelling Government Purpose

A legal concept referring to a reason the government may use to justify the imposition of restrictions that might otherwise infringe on individual rights, provided it is necessary for a significant public goal.