Which of the Following Statements Is FALSE

question 2

Multiple Choice

Which of the following statements is FALSE?

• A)The lease-equivalent loan is the loan that is required on the purchase of the asset that leaves the purchaser with the same obligations as the lessor would have.
• B)Lease obligations themselves could trigger financial distress.
• C)When a firm enters into a lease,it is committing to lease payments that are a fixed future obligation of the firm.
• D)When a firm leases an asset,it is effectively adding leverage to its capital structure (whether or not the lease appears on the balance sheet for accounting purposes).

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Definitions:

Ethical Principles

Principles that guide behavior and decisions based on ideas of right and wrong.

Formal Statement

An official, written expression of a fact, opinion, or policy, often used in legal, professional, or academic contexts.

Corruption

The abuse of entrusted power for private gain, manifesting in various forms such as bribery, embezzlement, and nepotism, negatively affecting the efficiency and fairness of public and private sectors.

Economic Espionage

The illegal and covert activity of obtaining confidential economic information or trade secrets from competitors for competitive advantage.