In Considering Whether a Company Should Invest in Debt or Equity

question 118

Multiple Choice

In considering whether a company should invest in debt or equity securities of another company,which of the following statements is incorrect?

• A) The company wants to make the best use of its excess cash to generate investment income.
• B) Investment income consists of interest earned from equity securities and dividends earned from debt investments.
• C) Investment income includes increases in the market value of debt or equity securities.
• D) The excess cash that can be invested could be the result of temporary or seasonal business fluctuations.

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Definitions:

Leave Request

A formal application made by an employee to take a temporary absence from their job for personal, health, or professional reasons.

Accommodation

A conflict resolution strategy where one party yields to the wishes or demands of the other, often at the cost of its own interests.

Unassertive

Characterized by a lack of confidence and firmness in one's actions or decisions, often leading to passive behavior.

True Conflict Resolution

The process of addressing and resolving a dispute or disagreement in a manner that genuinely considers and satisfactorily addresses the interests or needs of all parties involved.