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Which of the following statements best describe how capital structure can affect the firm through underinvestment? Group of answer choices Firms close to bankruptcy will

Which of the following statements best describe how capital structure can affect the firm through underinvestment?

Group of answer choices

Firms close to bankruptcy will not find it difficult to fund positive NPV projects, as long as the project has a positive NPV.

More than one of the other statements is correct.

None of the other statements is correct.

Underinvestment can occur when gains from a positive NPV project accrue mostly to shareholders when the firm is close to bankruptcy.

Firms close to bankruptcy will pass on positive NPV projects because no one will be willing to fund them.

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