Which of the Following Statements Is Most Correct

Multiple Choice

Which of the following statements is most correct?

A) A firm with financial leverage has a larger equity multiplier than an otherwise identical firm with no debt in its capital structure.
B) The use of debt in a company's capital structure results in tax benefits to the investors who purchase the company's bonds.
C) All else equal, a firm with a higher debt ratio will have a lower basic earning power ratio.
D) All of the answers above are correct.
E) Answers a and c are correct.