Greater Differences Exist in Capital Structures from Country to Country

Greater differences exist in capital structures from country to country than among industries within a given country. Reasons for this finding include all except which of the following statements?

A) Investors in different countries differ significantly in their willingness to assume risk, and this translates into more or less aggressive capital structures.
B) Governments in different countries impose different minimum equity capitalization requirements, and this translates into higher or lower debt ratios.
C) Information asymmetries and thus agency costs, are thought to be higher in shareholder-based systems of corporate governance (like in the U.S.) than in bank-based systems (like in Germany and Japan) , so different capital structures are observed.
D) Capital structures in countries whose stock markets are not very efficient tend to have higher debt ratios because of the challenges of raising capital through new equity offerings.
E) Countries that are more concerned about employment, social security, etc. than about economic efficiency tend to adopt policies that discourage bankruptcy except in extreme circumstances, so the usual restraints on excessive debt do not operate as they would in open markets and companies use higher debt ratios.