Which of the Following Statements Is False

question 15

Multiple Choice

Which of the following statements is false?

• A) The actual cash flow that the investor will get to keep will be reduced by the amount of any tax payments.
• B) The equivalent after-tax interest rate is r(1 - τ).
• C) The right discount rate for a cash flow is the rate of return available in the market on other investments of comparable risk and term.
• D) To compensate for the risk that they will receive less if the firm defaults, investors demand a lower interest rate than the rate on U.S. Treasuries.

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Definitions:

Positive Effect

The beneficial impact or positive outcome resulting from a particular action, behavior, or policy.

Heredity

The transmission of physical or mental traits through genes from one generation to the next.

Peer Influences

The effect that the social group individuals belong to has on their attitudes, behaviors, and beliefs.

Models of Competency

Theoretical frameworks that outline the essential skills, knowledge, and behaviors required for effective performance in a specific role or task.