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Which one of the following statements is true? Unpaid common stock dividends can force a firm into liquidation. Debt increases the possibility of financial distress.

Which one of the following statements is true?

Unpaid common stock dividends can force a firm into liquidation.

Debt increases the possibility of financial distress.

Payments of both interest and dividends are tax-deductible as business expenses.

Bondholders are generally granted voting rights equal to those of common shareholders.

U.S. non-financial firms tend to use more debt than equity financing.

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