Which of the Following Statements Is CORRECT,holding Other Things Constant

question 88

Multiple Choice

Which of the following statements is CORRECT,holding other things constant?

• A) Firms whose assets are relatively liquid tend to have relatively low bankruptcy costs,hence they tend to use relatively little debt.
• B) An increase in the personal tax rate is likely to increase the debt ratio of the average corporation.
• C) If changes in the bankruptcy code make bankruptcy less costly to corporations,then this would likely lead to lower debt ratios for corporations.
• D) An increase in the company's degree of operating leverage would tend to encourage the firm to use more debt in its capital structure so as to keep its total risk unchanged.
• E) An increase in the corporate tax rate would in theory encourage companies to use more debt in their capital structures.

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Definitions:

Childhood Cancer

Cancer types and occurrences found in individuals under 18 years of age, focusing on diseases unique to or most prevalent in this age group.

Discordant

Lacking harmony or agreement.

Genetic Component

The portion of variation in a phenotypic trait in a population that is due to genetic differences among individuals.

Concordance Rate

A statistical measure expressing the likelihood that both members of a twin pair or both siblings will share a particular disease or trait.