Exercise D-1 Identify reasons why companies invest (LO D-1) Required: Select whether the following statements are "True" or "False". 1. A reason companies invest in other companies is to build strategic alliances. 2. All companies are required to pay dividends to their investors. 3. When market interest rates increase, the market value of a bond increases as well. 4. One way for a company to expand operations into a new industry is to acquire the majority of common stock in another company that already operates in that industry. 5. Stocks typically have greater upside potential, providing a higher average return to their investors over the long run than do bonds. 6. Companies purchase debt securities primarily for the dividend revenue they provide