Which of the Following Is an Example of What a Person

question 80

Multiple Choice

Which of the following is an example of what a person might say if they were expressing what Eduardo Bonilla-Silva describes as a "cultural racism" argument in his book Racism without Racists: Color-Blind Racism and the Persistence of Racial Inequality in America?

• A) "People prefer to live among others of their own race or ethnicity, so segregation in housing and schools isn't anyone's fault."
• B) "Everyone has an equal chance of success in America!"
• C) "People of color have different values, and those values, not differences in opportunity or experiences of racism, make them poor."
• D) "Since we ended slavery and legal segregation, racism no longer exists-which means that if people of color aren't succeeding, it is their own fault."

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Definitions:

M&M Proposition I

A theorem stating that in a perfect market, the market value of a company is unaffected by how that company is financed, regardless of whether through debt or equity.

Debt

An amount of money borrowed by one party from another, to be repaid with interest.

M&M Proposition II

A theory in corporate finance that asserts the cost of equity is a linear function of the company's debt/equity ratio, under the assumption of no taxes and financial distress costs.