Which of the Following Statements Is False

question 64

Multiple Choice

Which of the following statements is false?

• A) Even after adjusting for personal taxes, the value of an unlevered firm exceeds the value of a levered firm, and there is a tax advantage to using debt financing.
• B) In Modigliani and Miller's setting of perfect capital markets, firms could use any combination of debt and equity to finance their investments without changing the value of the firm.
• C) When firms raise new capital from investors, they do so primarily by issuing debt.
• D) In most years aggregate equity issues are negative, meaning that firms are reducing the amount of equity outstanding by buying shares.

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Definitions:

Logic

A systematic method of reasoning that follows prescribed principles and guidelines to arrive at valid conclusions or understand complex ideas.

Speakers Intentions

The goals or objectives that a speaker aims to achieve through their speech or presentation.

Empathic Listening

Listening actively and attentively, aiming to understand the speaker's emotions and perspective.

Release Emotions

The act of expressing or letting go of feelings that have been pent up or repressed.