Which of the Following Statements Is NOT CORRECT

question 124

Multiple Choice

Which of the following statements is NOT CORRECT?

• A) Commercial paper can be issued by virtually any firm so long as it is willing to pay the going interest rate.
• B) Accruals are "free" in the sense that no explicit interest is paid on these funds.
• C) A conservative approach to working capital management will result in most if not all permanent assets being financed with long-term capital.
• D) The risk to a firm that borrows with short-term credit is usually greater than if it borrowed using long-term debt.This added risk stems from the greater variability of interest costs on short-term debt and possible difficulties with rolling over short-term debt.
• E) Bank loans generally carry a higher interest rate than commercial paper.

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Definitions:

Future Events

Occurrences that have not yet taken place but are considered in the planning, anticipation, or prediction processes.

Social Communication

The exchange of information and messages between individuals through verbal and non-verbal methods within a societal context.

Whorfian Hypothesis

The theory that the structure of a language affects its speakers' worldview or cognition and thus people's perceptions are relative to their spoken language.

Follow-Up Studies

are research activities conducted after an initial study to monitor outcomes and assess long-term effects or trends.