1. State whether each of the following statements is true or false. (40) (1) Only large, well established entities have

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1 State Whether Each Of The Following Statements Is True Or False 40 1 Only Large Well Established Entities Have 1 (74.83 KiB) Viewed 88 times

1. State whether each of the following statements is true or false. (40) (1) Only large, well established entities have easy access to securities markets to finance their business. (2) Indirect finance is more important than direct finance in financial structure. (3) Market efficient hypothesis is an application of Rational expectation theory. (4) An all-equity firm cannot go bankrupt. (5) Consider the asset demand function. There is a known coefficient valued at -0.7. Most likely it is the coefficient for risk. (6) If rational expectations hold, then the expected forecast error is always 0. (7) Using theory of rational expectation. We can not observe the expected return. (8) Consider f(x) = 2x, then the derivative with respect to x is 10x4. (9) If you are a banker and expect interest rates to rise in the future, you would prefer to make short-term loans. (10) Suppose X is uniformly distributed over the support range (1,5) then the average point in the support range is 3.