Which of the Following Statements Is False

question 76

Multiple Choice

Which of the following statements is false?

• A) As long as the firm's choice of securities does not change the cash flows generated by its assets, the capital structure decision will not change the total value of the firm or the amount of capital it can raise.
• B) If securities are fairly priced, then buying or selling securities has an NPV of zero and, therefore, should not change the value of a firm.
• C) The future repayments that the firm must make on its debt are equal in value to the amount of the loan it receives up front.
• D) An investor who would like more leverage than the firm has chosen can lend and add leverage to his or her own portfolio.

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Definitions:

Cell B1

Refers to the cell located at the intersection of column B and row 1 in a spreadsheet.

Manual Calculation Option

A setting in applications like spreadsheets that requires the user to request calculations instead of having them done automatically.

Quick Analysis Tool

A feature in certain software applications that provides immediate access to a range of analytical options for selected data.

Clipboard Group

A set of features in software applications (like MS Word) that manage copying, cutting, and pasting operations.