Which of the Following Statements Is FALSE

question 72

Multiple Choice

Which of the following statements is FALSE?

• A)Although indirect costs of bankruptcy are difficult to measure accurately,they are typically much smaller than the direct costs of bankruptcy.
• B)Bankruptcy protection can be used by management to delay the liquidation of a firm that should be shut down.
• C)Because many aspects of the bankruptcy process are independent of the size of the firm,the costs are typically higher,in percentage terms,for smaller firms.
• D)Aside from the direct legal and administrative costs of bankruptcy,many other indirect costs are associated with financial distress (whether or not the firm has formally filed for bankruptcy).