Which of the Following Statements Is FALSE

question 84

Multiple Choice

Which of the following statements is FALSE?

• A) Differential access to national capital markets is common enough that it provides the best explanation for the existence of currency swaps, which are like the interest rate swap contracts, but with the holder receiving coupons in one currency and paying coupons denominated in a different currency.
• B) Currency swaps generally also have final face value payments, also in different currencies.
• C) Using a currency swap, a firm can borrow in the market where it has the best access to capital, and then "swap" the coupon and principal payments to whichever currency it would prefer to make payments in.
• D) With differential access to national markets, to maximize shareholder value, the firm should raise capital in the foreign market; the method of valuing the foreign project as if it were a domestic project would then provide the correct net present value (NPV).

---

Definitions:

Lanugo

Fine, soft hair, especially that which covers the body and limbs of a human fetus or newborn.

Anorexia Nervosa

An eating disorder characterized by an extreme fear of gaining weight and a distorted body image, leading to severe food restriction and weight loss.

Sexual Desire

A person's overall sexual drive or interest in sexual activity, which can vary greatly among individuals.

Heterosexual Men

Males who are sexually attracted to females.