A Common Fixed Cost Is a Fixed Cost That Is

question 225

True/False

A common fixed cost is a fixed cost that is incurred because of the existence of a particular business segment and that would be eliminated if the segment were eliminated.

---

Definitions:

Senior Creditors

Creditors who have priority over other creditors for the repayment of debts, typically in the event of a bankruptcy or liquidation.

Yield To Maturity

The total return anticipated on a bond if the bond is held until it matures, considering all interest payments and the principal repayment.

Coupon Rate

The interest rate on a bond, which is calculated as a percentage of the face value, and paid to the bondholders periodically until maturity.

Par Value

It represents the nominal or face value of a security, such as a share or bond, and is the minimum price at which such securities might be issued originally.