True/False
The pecking order explanation of capital structure states that a hierarchy of financing exists for firms, in which new external debt financing is employed first, followed by retained earnings and finally by external equity financing.
Correct Answer:
Verified
Correct Answer:
Verified
Related Questions
Q60: Leverage results from the use of equity
Q61: The lower risk nature of long-term debt
Q62: Financial leverage measures the effect of fixed
Q63: In general, a firm's theoretical optimal capital
Q64: _ costs require the payment of a
Q66: _ is the risk of being unable
Q67: Holding all other factors constant, a firm
Q68: Financial risk is the risk to a
Q69: A firm has fixed operating costs of
Q70: The basic shortcoming of the EBIT-EPS approach