Which One of These Represents a Difference Between Business Entities

question 60

Multiple Choice

Which one of these represents a difference between business entities in Japan and in the United States?

• A)Lenders in Japan frequently also take ownership positions in firms to which they lend.
• B)Debt-equity ratios tend to be higher in the U.S.than they are in Japan.
• C)There tends to be greater agency issues between stockholders and bondholders in Japan as compared to the U.S.
• D)Bondholders in Japan are prohibited from also being shareholders in the same firm.
• E)The debt-equity ratios for firms in Japan and in the U.S.tend to be relatively equal.

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Definitions:

Revocation Effective

The point at which a revocation, or calling back of an offer, becomes legally binding.

Invitation to Negotiate

A pre-contractual communication inviting parties to discuss terms before entering into a formal agreement.

Option Contract

A contract that gives the holder the right, but not the obligation, to buy or sell an asset at a predetermined price within a specific time frame.

Standard Sales Contract

An agreement that outlines the terms and conditions of a sale, typically using established clauses to facilitate common transactions.