All of the Following Are Advantages of Debt Financing, Except

question 29

Multiple Choice

All of the following are advantages of debt financing, except:

• A) It's useful for meeting a short-term deficit in cash flow.
• B) The term of the debt (loan) is generally limited.
• C) Interest paid is tax deductible.
• D) If it is a "demand" loan, it can be called by the lender at any time.

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Definitions:

Circuit

A closed path through which electric current flows or may flow.

Reactive Power

The portion of electricity that establishes and sustains the electric and magnetic fields in AC operations, measured in volt-amperes reactive (VAR).

RLC Series Circuit

A circuit configuration comprising a resistor (R), inductor (L), and capacitor (C) connected in series.

Applied Voltage

The voltage that is externally applied to an electrical circuit or device, which drives the current through it.