Which of the Following Represents a Disadvantage of Issuing Bonds

question 380

Multiple Choice

Which of the following represents a disadvantage of issuing bonds?

• A) Bonds are permanent debt on the firm's balance sheet.
• B) Dividends are legally required.
• C) Bonds increase the firm's debt.
• D) Bondholders receive voting rights.

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Definitions:

Relative Size

A perceptual cue that allows the brain to determine the size of an object in relation to others, aiding in the perception of depth and distance.

Ponzo Illusion

A visual illusion where two lines of the same length appear different in length due to converging parallel lines.

Müller-Lyer Illusion

A visual illusion in which two lines of the same length appear to be of different lengths due to the placement of arrow-like figures at the ends.

Horizontal-Vertical Illusion

A visual illusion where the perception of length is distorted; horizontal segments appear longer than vertical ones of the same length.