Which of the following statements is correct? Group of answer choices One disadvantage of forming a...

Which of the following statements is correct?

Group of answer choices

One disadvantage of forming a corporation is that equity investors are usually exposed to less liability than they would be in a partnership.

Corporations face more regulations than sole proprietorships.

One disadvantage of operating a business as a sole proprietor is that the firm is subject to double taxation, because taxes are levied at both the firm level and the owner level.

It is generally less expensive to form a corporation than a proprietorship because, with a proprietorship, extensive legal documents are required.

If a partnership goes bankrupt, each partner is exposed to liabilities only up to the amount of his or her investment in the business.

Expert Solution

The statements that are correct are :

Corporations are subject to more regulations than sole proprietorship. As they operate on a public platform they need to comply with a number of regulations failing which the business can face litigation and lose the status of a corporation.

If a partnership firm goes bankrupt then each partner is exposed to liabilities only upto the amount of his or her investment.

It is known as limited liability partnership.

The Statements which are you incorrect are :

Equity investors are only concerned with the amount of the investment they have made with the corporation and they are not subject to or are responsible for any liabilities.

Sole proprietorship has an advantage of pass through taxation, the owner and the business entity are not considered separate identities. So, the problem of double taxation exists in a corporation and not in sole proprietorship.

It is generally more expensive to form a corporation due to the extensive paper work and compliance required.

jeff jeffy answered 2 years ago

Which of the following statements is false? Group of answer choices One disadvantage of the corporate...

Which of the following statements is false? Group of answer choices One disadvantage of the corporate form is the double taxation of profit. A debenture is an unsecured debt with maturity longer than 10 years. The primary goal of a publicly-owned for-profit corporation is to maximize the value of stock. As interest rate increases significantly, companies are more likely to call the callable bonds they have issued. Equity holders have a residual claim in the firm while creditors have voting...

Which of the following statements is correct? Group of answer choices None of these is correct....

Which of the following statements is correct? Group of answer choices None of these is correct. The demand for iPads is more elastic than the demand for tablets in general. Here, iPads is one kind of tablets. The demand for a necessity good is more elastic than the demand for a luxury good. The demand for cell phones is more elastic over a short period of time than over a long period of time

Which of the following statements is CORRECT? Group of answer choices An increase in the DSO,...

Which of the following statements is CORRECT? Group of answer choices An increase in the DSO, other things held constant, could be expected to increase the ROE. An increase in the DSO, other things held constant, could be expected to increase the total assets turnover ratio. If two firms have the same ROA, the firm with the most debt can be expected to have the lower ROE. The ratio of long-term debt to total capital is less likely to experience...

Which of the following statements is correct? Group of answer choices If a project with normal...

Which of the following statements is correct? Group of answer choices If a project with normal cash flows has an IRR greater than the WACC, the project must also have a positive NPV. A project’s MIRR can never exceed its IRR. If Project A’s IRR exceeds Project B’s, then A must have the higher NPV. If the NPV is negative, the IRR must also be negative. If a project with normal cash flows has an IRR less than the WACC,...

Which of the following statements is CORRECT? Group of answer choices The WACC is not related...

Which of the following statements is CORRECT? Group of answer choices The WACC is not related to the cost of debt or equity capital The WACC will be changing for the changing market value of the shares and debentures The WACC should be the hurdle rate for evaluating all projects The WACC is the expected rate of return for the market

Which of the following statements is(are) correct? Group of answer choices Assume that goods A and...

Which of the following statements is(are) correct? Group of answer choices Assume that goods A and B are substitutes. Suppose a technology improvement in the production of good A and an increase in the price of good B. If everything else remains the same, in the market of good A, the equilibrium price decreases but the effect on the equilibrium quantity depends on the magnitudes of the shifts in supply and demand Assume that goods M and N are complements....

Which of the following statements is correct? Group of answer choices The dividend theory espoused by...

Which of the following statements is correct? Group of answer choices The dividend theory espoused by Modigliani and Miller would say that firms would be better served with a constant pattern of growing dividends. The tax differential dividend theory by Litzenberger and Ramaswamy, would say that firms will be better off to pay a higher amount of dividends because the lower tax rates associated with dividends as compared to capital gains. The bird-in-the-hand theory would say that a higher dividend...

Which of the following statements is CORRECT? Group of answer choices 1) The use of debt...

Which of the following statements is CORRECT? Group of answer choices 1) The use of debt financing will tend to lower the basic earning power ratio, other things held constant. 2) A firm that employs financial leverage will have a higher equity multiplier than an otherwise identical firm that has no debt in its capital structure. 3) If two firms have identical sales, interest rates paid, operating costs, and assets, but differ in the way they are financed, the firm...

1)which are correct of these statements . Group of answer choices: a)If a security is underpriced,...

1)which are correct of these statements . Group of answer choices: a)If a security is underpriced, then the expected holding period return is above the market capitalization rate. b)The value of the equity equals the present value of all future payouts (dividends plus repurchases). c)The value of a share equals the present value of all future dividends per share. d)If a firm reinvests its earnings at an ROE equal to the market capitalization rate, then its earnings-price (E/P) ratio is...

PART 1) Which of the following statements(s) is/are correct? Group of answer choices An weakness of...

PART 1) Which of the following statements(s) is/are correct? Group of answer choices An weakness of SPI is that it does not take into account if the project's critical path is on schedule. It is possible to have a SPI greater than 1.0 while the project is actually behind schedule. An weakness of SPI is that it does not take into account of activites/tasks that have a budgeted cost of zero, such as tasks dealing with submittals and ordering of...

Question