Multiple Choice
If a firm with favorable prospects sells new shares, _____.
A) the debt/assets ratio of the firm will increase
B) the marginal bankruptcy-related costs of the firm will increase
C) the retained earnings of the firm will decrease
D) the tax payable by the firm will decrease
E) the value of the firm's stock will decrease.
Correct Answer:
Verified
Correct Answer:
Verified
Q61: According to the signaling theory, which of
Q62: In 2015, a company had a total
Q63: Which of the following is an example
Q64: According to the signaling theory, what is
Q65: If a mature firm announces a new
Q67: With which of the followingis a firm's
Q68: A degree of operating leverage of 1.5
Q69: The fact that interest is tax-deductible makes
Q70: Which of the following assumptions outlined by
Q71: As a general rule, the optimal capital