Which of the following statements is CORRECT?
A. There is no reason to think that changes in the personal tax rate would affect firms' capital structure decisions.
B. A firm with high business risk is more likely to increase its use of financial leverage than a firm with low business risk, assuming all else equal.
C. If a firm's after-tax cost of equity exceeds its after-tax cost of debt, it can always reduce its WACC by increasing its use of debt.
D. Suppose a firm has less than its optimal amount of debt. Increasing its use of debt to the point where it is at its optimal capital structure will decrease the costs of both debt and equity financing.
E. In general, a firm with low operating leverage also has a small proportion of its total costs in the form of fixed costs.
Answer: E
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Two overall contexts influence international negotiations: the environmental context includes environmental forces that neither negotiator controls and the ________ context includes factors over which negotiators appear to have some control.
Fill in the blank(s) with the appropriate word(s).
One of the biggest strategic challenges to competing in the international arena includes
A. how to leverage the opportunities arising from shifting exchange rates. B. whether to offer a standardized product worldwide or a customized product offering in each different country market. C. whether to pursue a franchising strategy or a joint venture strategy. D. how to identify foreign firms licensed to produce and distribute the company's products. E. how to charge the same price in all country markets.
What is an asset?
a. anything of value or a resource of value that can be converted into stocks. b. anything of value or a resource of value that can be converted into cash. c. anything of value or a resource of value that can be converted into bonds. d. none of the above.
With a couple of new ideas regarding software design, Carol and Ray start a partnership that, with business success, becomes Pacific Applications Company. The company grows to include a staff of twenty-one employees. Over time, Pacific develops a new computer operating system. The firm signs licensing contracts with several computer manufacturers, but needs to double the number of its employees to fulfill those contracts. Is Pacific subject to federal antidiscrimination laws? If so, what should it consider in hiring new employees?
What will be an ideal response?