The Fact That the After-Tax Cost of Debt Is Lower

question 60

Multiple Choice

The fact that the after-tax cost of debt is lower than the pretax cost of debt implicitly assumes thatinterest expense can be

• A) refinanced.
• B) margined.
• C) expensed.
• D) none of the above

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Definitions:

Dissociation

A mental process of disconnecting from one's thoughts, feelings, memories, or sense of identity, often a response to trauma or stress.

Malingering

The act of feigning or exaggerating illness or disability to escape duty or work, or to gain sympathy, aid, or compensation.

La Belle Indifference

A term referring to an unusual lack of concern for one’s physical symptoms, typically seen in conversion disorder.

Agoraphobia

An anxiety disorder involving intense fear and avoidance of places or situations where escape might be difficult or help might not be available in the event of panic.