Which of the Following Statements Is True

question 59

Multiple Choice

Which of the following statements is true?

• A)the cost of equity is more difficult to derive than the cost of preferred shares.
• B)the firm's shares will not be bid up if the firm does not pay dividends.
• C)The DDM cannot be used to value companies who do not pay dividends.
• D)equity financing will provide the corporation with a tax shield.

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Definitions:

Calcitonin

A thyroid gland secretion crucial for the regulation of calcium quantities in the blood.

Epiphyseal Plate

A growth plate located at the ends of long bones where new bone tissue is generated during growth.

Zone of Proliferation

Refers to a region in a growth plate of bones where cartilage cells are rapidly dividing and contributing to bone lengthening.

Zone of Calcification

A region in bone where cartilage is being replaced by bone tissue during the growth process.