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The Inexpensive Nature of Long-Term Debt in a Firm's Capital

Question 7

Multiple Choice

The inexpensive nature of long-term debt in a firm's capital structure is partly because ________.


A) the debt holders are the true owners of the firm
B) equity capital has a fixed return
C) long-term debt has a fixed return and a maturity date
D) dividend payments are tax-deductible

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