WWhy this statement is false?Homework Answers
Answer:
This statement is false since:
Shareholders do not have any incentive to invest in negative-NPV project. Debt holders get their interest payments and repayments as per contractual terms. NPV gives net addition to shareholder wealth. Any investment of negative-NPV project will directly reduce shareholders' wealth. Hence shareholders' will have incentive to invest in positive-NPV projects.
Debt holders get their contractual payments irrespective of agency costs.
Hence the statement is false.
Add Answer to:
WWhy this statement is false? d). Shareholders have an incentive to invest in negative-NPV projects that are risky, even...
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I need Summary of this Paper i dont need long summary i need What methodology they used , what is the purpose of this p...
I need Summary of this Paper i dont need long summary i need
What methodology they used , what is the purpose of this paper and
some conclusions and contributes of this paper. I need this for my
Finishing Project so i need this ASAP please ( IN 1-2-3 HOURS
PLEASE !!!)
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I need Summary of this Paper i dont need long summary i need
What methodology they used , what is the purpose of this paper and
some conclusions and contributes of this paper. I need this for my
Finishing Project so i need this ASAP please ( IN 1-2-3 HOURS
PLEASE !!!)
Budgetary Policy and Economic Growth Errol D'Souza The share of capital expenditures in government expenditures has been slipping and the tax reforms have not yet improved the income...
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