Which One of the Following Statements Is Correct

question 3

Multiple Choice

Which one of the following statements is correct?

• A) The lower the level of a company's debt, the higher the company's leverage.
• B) The lower the level of a company's debt, the lower the company's equity multiplier.
• C) The lower the level of a company's debt, the higher the company's equity multiplier.
• D) The tax benefit from using debt financing reduces a company's risk.

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Definitions:

Generalized Anxiety

A chronic condition characterized by excessive, uncontrollable worry about everyday things across various situations.

Irrational Assumptions

Beliefs that are based on incorrect reasoning or understanding, often leading to negative consequences or behaviors.

Conditions Of Worth

In humanistic psychology, these are external standards that one believes one must meet to earn respect and love from others.

Rational-Emotive Therapy

A form of cognitive-behavioral therapy that focuses on changing irrational beliefs and thought patterns that contribute to emotional or behavioral issues.