Which of the Following Statements Is False

question 11

Multiple Choice

Which of the following statements is false?

• A) Investors can alter the leverage choice of the firm to suit their personal tastes either by borrowing and reducing leverage or by holding bonds and adding more leverage.
• B) On the market value balance sheet the total value of all securities issued by the firm must equal the total value of the firm's assets.
• C) The market value balance sheet captures the idea that value is created by a firm's choice of assets and investments.
• D) One application of MM Proposition I is the useful device known as the market value balance sheet of the firm.

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Definitions:

Mental Image

The representation in a person's mind of the physical world outside that individual.

Counterconditioning

A therapeutic technique aiming to change the response to a certain stimulus by associating it with a new, more desirable behavior or response.

Operant Conditioning

A learning process through which the strength of a behavior is modified by reinforcement or punishment, developed by B.F. Skinner.

B.F. Skinner

An American psychologist best known for his work in behaviorism and the development of the theory of operant conditioning.