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A Firm Does Not Have to Repay Its Equity Funds

question 91

True/False

A firm does not have to repay its equity funds and is not obliged to pay dividends.Therefore equity is a cheaper source of funds than debt.


Definitions:

Fertilizer

A chemical or natural substance added to soil or land to increase its fertility and promote plant growth.

Sunny Side

A term commonly referring to the side of an object or place receiving the most sunlight, or the optimistic perspective of a situation.

Shady Side

A term referring to the darker, cooler, or less exposed area or aspect of something, often used literally or metaphorically to describe a situation or place.

Randomized Block Design

An experimental design that groups subjects into blocks based on certain similarities before randomly assigning treatments, reducing confounding variables.

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