Which of the Following Statements Is FALSE

question 35

Multiple Choice

Which of the following statements is FALSE?

• A)The relative proportions of debt,equity,and other securities that a firm has outstanding constitute its capital structure.
• B)The most common choices are financing through equity alone and financing through a combination of debt and equity.
• C)The project's net present value (NPV)represents the value to the new investors of the firm created by the project.
• D)When corporations raise funds from outside investors,they must choose which type of security to issue.

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Definitions:

Profitability

A financial metric that measures the degree to which a company or activity yields profit when compared to its size, costs, or investments.

Disclosure Documents

Official documents that provide detailed information about an investment, required by law to be provided to prospective investors.

Prospective Franchisees

Individuals or entities considering entering into a franchise agreement, evaluating the business opportunity and requirements.

Legal Requirements

Obligations or conditions defined by law that individuals and organizations must adhere to.