Facebook, Inc. has no debt. By issuingdebt, Facebook can generate a very large tax shield potentially worth nearly $2 billion. GivenFacebook's success, one would be hard pressed to argue thatFacebook's management arenave and unaware of this huge potential to create value. A more likely explanation is that issuing debt would entail other costs. Which of the following costs of debt is unlikely to explainFacebook's policy?

A.

Human capital risk

B.

Cash flow volatility

C.

Asset substitution

D.

Cash flow risk