Debt contracts involve fixed payments at regular intervals, have lower state verification costs compared to equity contracts, and are more commonly used for raising capital, making all of the provided statements correct.

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Debt Contracts

Question 46

Multiple Choice

Debt contracts

A) are agreements by the borrowers to pay the lenders fixed dollar amounts at periodic intervals.
B) have an advantage over equity contracts in that they have a lower cost of state verification.
C) are used much more frequently to raise capital than equity contracts.
D) all of the above.
E) only A and B of the above.

Correct Answer: