Which One of the Following Statements Is Correct

question 11

Multiple Choice

Which one of the following statements is correct?

• A)Firms should generally finance all of their assets with long-term debt.
• B)A firm is less apt to face financial distress if it adopts a flexible financial policy rather than a restrictive policy.
• C)Short-term borrowing is generally more expensive than long-term borrowing.
• D)Long-term interest rates tend to be more volatile than short-term interest rates.
• E)Firms that follow restrictive financial policies can generally avoid short-term debt financing.

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Definitions:

Flooding

An overflow of water onto land that is normally dry, often caused by heavy rain, melting snow, or breaches in water control structures.

Foreseen

Expected to occur in the future based on forecasts or predictions.

False Imprisonment

The unlawful confinement of a person without consent or legal authority, effectively restricting their freedom of movement.

Qualified Privilege

A legal immunity granted in specific circumstances, usually during defamation cases, allowing freedom of expression without liability, provided statements are made without malice.