Which of the Following Statements Is FALSE

question 33

Multiple Choice

Which of the following statements is FALSE?

• A)In bankruptcy,management is given the opportunity to reorganize the firm and renegotiate with debt holders.
• B)Because a corporation is a separate legal entity,when it fails to repay its debts the people who lent to the firm,the debt holders,are entitled to seize the assets of the corporation in compensation for the default.
• C)As long as the corporation can satisfy the claims of the debt holders,ownership remains in the hands of the equity holders.
• D)If the corporation fails to satisfy debt holders' claims,debt holders may lose control of the firm.

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Definitions:

Just-world Phenomenon

The cognitive bias that assumes good things happen to good people and bad things happen to bad people.

Groupthink

A psychological phenomenon that occurs within a group of people, where the desire for harmony and conformity results in irrational or dysfunctional decision-making outcomes.

Norm

A standard or pattern that is typical or expected within a specific group, context, or society.

Japan

A country in East Asia, known for its rich culture, technological advancements, and as an archipelago of thousands of islands.