Which of the Following Statements Is FALSE

question 91

Multiple Choice

Which of the following statements is FALSE?

• A)Given a 35% corporate tax rate,for every $1 in new permanent debt that the firm issues,the value of the firm increases by $0.65.
• B)The firm's marginal tax rate may fluctuate due to changes in the tax code and changes in the firm's income bracket.
• C)Many large firms have a policy of maintaining a certain amount of debt on their balance sheets.
• D)Typically,the level of future interest payments varies due to changes the firm makes in the amount of debt outstanding,changes in the interest rate on that debt,and the risk that the firm may default and fail to make an interest payment.

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Definitions:

Collective

Pertaining to a group of individuals acting as a whole, especially when owning property, making decisions, or sharing duties and responsibilities.

Group-Level Goals

Objectives that are set and pursued by a group collectively, rather than by individuals, to achieve a common outcome or task.

Key Characteristics

Essential attributes or features that define and differentiate an object, concept, or phenomenon.

Degree of Unity

A measure of the level of agreement or cohesion within a group or among members of a collective.