Generally, More Use Is Made of Short-Term Financing Because

question 23

Multiple Choice

Generally, more use is made of short-term financing because

• A) short-term interest rates are generally lower than long-term interest rates.
• B) most firms do not have basic access to the capital markets.
• C) short-term financing is usually more predictable than long-term financing.
• D) short-term interest rates are generally lower than long-term interest rates and most firms do not have basic access to the capital markets.

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Definitions:

Individual Income Tax

A tax levied on the income of individuals, including wages, salaries, and investment returns.

Clothing Tax

A specific tax imposed on the sale or purchase of clothing, which can vary by jurisdiction.

Proportional Tax

A tax system where the tax rate remains constant regardless of the amount subject to tax.

Federal Income Tax

Tax levied by the national government on the annual income of individuals, corporations, trusts, and other legal entities.