Which of the Following Statements Is Most Correct

question 21

Multiple Choice

Which of the following statements is most correct?

• A) An increase in the corporate tax rate,would lower the weighted average cost of capital for an average firm,other things held constant.
• B) Depreciation-generated funds have a cost equal to the firm's lowest WACC,and hence they have no impact on the MCC schedule.
• C) As a firm's debt-to-assets ratio approaches 100 percent,the after-tax cost of debt,r_dT,will be at its lowest level.
• D) Statements a,b,and c are all true.
• E) Statements a,b,and c are all false.

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Definitions:

Indirect Discrimination

Practices or policies that appear neutral but result in a disproportionate impact on a protected group without a justifiable reason.

Diminishing Marginal Returns

The principle stating that as additional units of a variable resource are added to a fixed resource, the additional output produced by each new unit eventually decreases.

Direct Discrimination

Unfair treatment of individuals based on their specific characteristics, such as race, gender, or age, as directly expressed by actions or policies.

Indirect Discrimination

practices or policies that appear neutral but result in unfair treatment of certain groups without direct intention to discriminate.