Which of the following statements is FALSE?
A)When a firm borrows money to repurchase shares that account for a significant percentage of its outstanding shares, the transaction is called a leveraged recapitalization.
B)MM Proposition I applies to capital structure decisions made at any time during the life of a firm.
C)By choosing positive-NPV projects that are worth more than their initial investment, a firm can enhance its value.
D)The choice of capital structure does not change the value of a firm if the cost of equity is higher than the cost of debt.

Question

Quizplus · Accepted Answer

The Answer of Which of the following statements is FALSE?
A)When a firm borrows money to repurchase shares that account for a significant percentage of its outstanding shares, the transaction is called a leveraged recapitalization.
B)MM Proposition I applies to capital structure decisions made at any time during the life of a firm.
C)By choosing positive-NPV projects that are worth more than their initial investment, a firm can enhance its value.
D)The choice of capital structure does not change the value of a firm if the cost of equity is higher than the cost of debt.

Which of the Following Statements Is FALSE