Which Statement Is FALSE Concerning Capital Structure

question 80

Multiple Choice

Which statement is FALSE concerning capital structure?

• A) Firms with large amounts of tangible assets tend to use a lot of debt in their capital structures.
• B) When corporate profits are taxed at the corporate and personal level,the benefits of leverage are greatly reduced.
• C) Modern trade off theory predicts that a firm's optimal debt level is set by trading off the tax benefits of leverage against the agency costs of increased debt.
• D) Debt is used more frequently abroad (such as Germany and England)as international laws tend to favor debtors.

---

Definitions:

Transcranial Magnetic Stimulation

A noninvasive procedure that uses magnetic fields to stimulate nerve cells in the brain to improve symptoms of certain mental health conditions.

Brain Activity

The electrical and chemical processes occurring within the brain that enable thinking, feeling, and coordination of sensory and motor functions.

Pons

A hindbrain structure above the medulla; it regulates sleep and arousal and coordinates movements of the left and right sides of the body.

Hindbrain

Hindbrain is a part of the brain that includes structures like the cerebellum and the brainstem, which are responsible for basic life functions and coordination.