A Negative Feature of Defining Investment by Excluding the Portion

Multiple Choice

A negative feature of defining investment by excluding the portion of total assets employed that are financed by short-term creditors is that:

A) short-term debt is always more expensive to finance than long-term debt.
B) current liabilities are sometimes difficult to define.
C) this method encourages managers to use an excessive amount of short-term debt.
D) this method encourages managers to use an excessive amount of long-term debt.