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Which of the Following Reasons Causes Bonds to Be a Less

Question 15

Multiple Choice

Which of the following reasons causes bonds to be a less expensive form of capital for a public firm than the issuance of common stock? Bondholders


A) bear less risk than common stockholders bear.
B) have prior voting rights over common stockholders.
C) receive greater returns than common stockholders.
D) investors pay a lower tax rate on bond interest

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