Question
12. Large institutional investors can have considerable influence over an organization's corporate finance decisions. True False 15. Preferred stock is considered a hybrid because the
12. Large institutional investors can have considerable influence over an organization's corporate finance decisions. True False
15. Preferred stock is considered a hybrid because the value can increase, like common stock, but it also offers interest payments, like a bond. True False
16. When an organization is unable to fulfill the obligations of its debt covenants under a bond indenture, the legal consequence could result in the organizations assets being transferred to the bondholders. where the assets of the firm are transferred to the debt-holders. True False
18. In an effort to optimize the capital structure, an organization may continue to add debt to the capital structure, up to some point where the tax benefits of the debt are overcome by the burden of interest payments. True False
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