Which of the following statements is TRUE?

A. Calculating the precise present value of financial distress costs is a relatively straightforward process

B. Firms with steady, reliable cash flows, such as utility companies, are able to use high levels of debt and still have a very low probability of default.

C. Firms whose value and cash flows are very volatile (for example, semiconductor firms) must have much higher levels of debt to avoid a significant risk of default

D. The presence of financial distress costs can explain why firms choose debt levels that are too high to fully exploit the interest tax shield.