Which of the Following Statements Is False

question 9

Multiple Choice

Which of the following statements is false?

• A) If a firm only needs to use the asset for a short time, it is probably less costly to lease it than to buy and resell the asset.
• B) While owners of assets are likely to resell them only if the assets are "lemons," a short-term lease can commit the user of an asset to return it regardless of its quality. In this way leases can help mitigate the adverse selection problem in the used goods market.
• C) Car dealerships are in a better position to sell a used car at the end of a lease than a consumer is.
• D) If the asset's tax depreciation deductions are faster than its lease payments, there are tax gains from a true tax lease if the lessor is in a lower tax bracket than the lessee.

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Definitions:

Prolactin

A hormone produced by the anterior pituitary gland that stimulates milk production after childbirth and affects many other functions in the body, including metabolism, immune system regulation, and water and electrolyte balance.

Glycoproteins

Proteins that have carbohydrate groups attached to the polypeptide chain, involved in various biological processes, including cell-cell recognition and immune responses.

Erectile Structure

A body part capable of becoming erect or rigid through the engorgement of blood vessels, often used in reference to parts of the reproductive system.

Glans Penis

The sensitive bulbous structure at the distal end of the penis.