Author Question: Since the issuer of zero (or low) coupon bonds can annually deduct the current year's interest ... (Read 22 times)

Alygatorr01285

  • Hero Member
  • *****
  • Posts: 564
Since the issuer of zero (or low) coupon bonds can annually deduct the current year's interest accrual without having to actually pay the interest until the bond matures (or is called), its cash flow each year is increased by the amount of the tax
 
  shield provided by the interest deduction.
  Indicate whether the statement is true or false

Question 2

Cash outlays that had been previously made and have no effect on the cash flows relevant to a current decision are called ________.
 
  A) incremental historical costs
  B) incremental past expenses
  C) opportunity costs foregone
  D) sunk costs



scottmt

  • Sr. Member
  • ****
  • Posts: 322
Answer to Question 1

TRUE

Answer to Question 2

D



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

The oldest recorded age was 122. Madame Jeanne Calment was born in France in 1875 and died in 1997. She was a vegetarian and loved olive oil, port wine, and chocolate.

Did you know?

Everyone has one nostril that is larger than the other.

Did you know?

The lipid bilayer is made of phospholipids. They are arranged in a double layer because one of their ends is attracted to water while the other is repelled by water.

Did you know?

Before a vaccine is licensed in the USA, the Food and Drug Administration (FDA) reviews it for safety and effectiveness. The CDC then reviews all studies again, as well as the American Academy of Pediatrics and the American Academy of Family Physicians. Every lot of vaccine is tested before administration to the public, and the FDA regularly inspects vaccine manufacturers' facilities.

Did you know?

People with alcoholism are at a much greater risk of malnutrition than are other people and usually exhibit low levels of most vitamins (especially folic acid). This is because alcohol often takes the place of 50% of their daily intake of calories, with little nutritional value contained in it.

For a complete list of videos, visit our video library