Which of the Following Statements Is FALSE

question 70

Multiple Choice

Which of the following statements is FALSE?

• A)Rather than set debt according to a target debt-equity ratio or interest coverage level,a firm may adjust its debt according to a fixed schedule that is known in advance.
• B)When we relax the assumption of a constant debt-equity ratio,the equity cost of capital and WACC for a project will change over time as the debt-equity ratio changes.
• C)When we relax the assumption of a constant debt-equity ratio,the APV and FTE methods are difficult to implement.
• D)If a firm is using leverage to shield income from corporate taxes,then it will adjust its debt level so that its interest expenses grow with its earnings.

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Definitions:

Racial Taxonomy

A system of classification that categorizes humans into large and distinct groups by ancestry, physical appearance, and other hereditary traits.

Marked

Described or signified in a noticeable or significant way, often used in sociolinguistics to indicate words or forms that carry specific social information.

Performances of Masculinity

The various ways in which individuals express and enact masculinity based on societal norms and expectations.

Cool Pose

A behavioral and cultural expression among African American males that projects an image of poise, confidence, and control in the face of societal marginalization and stereotype challenges.