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  3. Study Set
    Principles of Finance
  4. Exam
    Exam 14: Capital Structure and Dividend Policy Decisions
  5. Question
    One of the Implications of Signaling Theory for Capital Structure
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One of the Implications of Signaling Theory for Capital Structure

Question 4

Question 4

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One of the implications of signaling theory for capital structure decisions is that firms should normally seek to maintain a reserve borrowing capacity.

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