Which of the Following Are NOT Ways Risk Management Can

question 10

Multiple Choice

Which of the following are NOT ways risk management can be used to increase the value of a firm?

• A) Risk management can increase debt capacity.
• B) Risk management can help a firm maintain its optimal capital budget.
• C) Risk management can reduce the expected costs of financial distress.
• D) Risk management can help firms minimize taxes.
• E) Risk management can allow managers to defer receipt of their bonuses and thus postpone tax payments.

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Definitions:

Inferiority Complex

A psychological condition in which a person feels a deep sense of inadequacy and lacking in comparison to others.

Oral Fixation

A fixation in the oral stage of development, resulting in an obsession with oral activities.

Electra Complex

A psychoanalytic theory that suggests a girl's psychosexual competition with her mother for possession of her father.

Neo-Freudians

Describes psychologists and psychoanalysts who followed Freud but diverged in their theories, emphasizing social and cultural factors over innate biological drives.