Which of the Following Is NOT a Reason Why Debt

question 76

Multiple Choice

Which of the following is NOT a reason why debt capital is considered to be the least risky source of capital?

• A) It has a high priority claim against assets and earnings.
• B) It has a strong legal position.
• C) It is a low cost source of capital because interest payments are tax deductible.
• D) It does not normally have to be repaid at a specific future date.

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Definitions:

Embryonic Development

The process by which an embryo forms and develops, starting from the fertilization of the egg to the fetus stage.

Solid Ball

A three-dimensional geometric object that is perfectly symmetrical around its center, with every point on its surface equidistant from the center.

Blastomeres

Cells formed in the early stages of embryonic development through a series of cleavage divisions from the zygote.

Embryonic Development

The series of biological changes that occur in the early stages of an organism's life, leading to its mature form.