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Identify the Incorrect Statement Regarding Debt Loans

Question 60

Multiple Choice

Identify the incorrect statement regarding debt loans.


A) They are made when a corporation sells stock to investors and gives its holders a claim to the firm's profit stream.
B) Management has no discretion as to the amount it will pay investors.
C) They include cash loans from banks and funds raised from the sale of corporate bonds to investors.
D) They require the corporation to repay a predetermined portion of the loan amount at regular intervals regardless of how much profit it is making.

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