Which of the Following Is NOT One of the Simplifying

question 58

Multiple Choice

Which of the following is NOT one of the simplifying assumptions made for the three main methods of capital budgeting?

• A)The firm pays out all earnings as dividends.
• B)The project has average risk.
• C)Corporate taxes are the only market imperfection.
• D)The firm's debt-equity ratio is constant.

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Definitions:

Government Expenditures

The total amount of money spent by the government on various services and projects, including healthcare, education, and infrastructure.

Major Expenditure

Large financial spending, often on significant items or services, that represents a considerable portion of an entity's budget.

Sales Tax

A tax imposed by governments on the sale of goods and services, added to the retail price.

Tax Freedom Day

The day of the year when a nation as a whole has theoretically earned enough income to pay its taxes for the year.