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Which of the following is not a true statement?
A) Companies that are believed to have high bankruptcy risk generally receive low credit ratings and must pay a higher interest rate for borrowing.
B) As a company’s level of debt increases, the risk of bankruptcy increases.
C) Interest expense incurred when borrowing money, as well as dividends paid to stockholders, are both tax-deductible.
D) The mixture of liabilities and stockholders’ equity a business uses is called its capital structure.
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