Which of the following statements is false:

Multiple Choice

• A firm with low operating leverage will have low fixed costs compared to a firm with high operating leverage.

• Capital intensive projects with heavy investments in plant and machinery will generally have a high degree of operating leverage.

• Bond rating that are CCC or lower are rated investment quality or grade.

• Maximum growth rate that can be achieved with only internal financing is called the internal growth rate.

• Based on the payback rule, an investment is acceptable if its calculated payback period is less than some prespecified number of years.