Debt Is Often Considered to Be Generally Less Expensive Than

question 8

Multiple Choice

Debt is often considered to be generally less expensive than equity because:

• A)debt costs less to acquire than equity.
• B)the transactions costs associated with debt are generally less than those associated with equity.
• C)dividends are tax-deductible.
• D)interest payments on debt are tax-deductible and reduce the payor's taxable income.

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Definitions:

Confidence Level

The percentage or proportion of times that an estimated interval is expected to contain the true value of the parameter.

Interval Estimate

An estimate of a population parameter that specifies a range within which the parameter is estimated to lie.

Population Parameter

Any numerical quantity that characterizes a given population or some aspect of it.

Confidence Interval

A continuum of estimates, garnered from sample data analysis, presumed likely to contain the concealed value of a population trait.