A fiRm That Is Approaching Bankruptcy Will fiNd That

Multiple Choice

A firm that is approaching bankruptcy will find that

A) Stockholders will try to push the firm into bankruptcy as rapidly as possible.
B) Bondholders will attempt to push the firm into bankruptcy to prevent their position from deteriorating.
C) Stockholders will seek to protect the value of the assets of the firm as much as possible.
D) Direct bankruptcy costs such as filing fees will tend to diminish.
E) Indirect bankruptcy costs such as opportunity costs will tend to decrease.