1.) There is abundant evidence that most companies operate at or near their optimal capital structures.

a True

b False

2.) A firm's excess cash can be readily determined from its balance sheet.

a. True

b. False

3.) Capital leasing arrangements are most likely to be mutually beneficial to lessor and lessee when the lessor is taxed at a higher rate and can issue debt at a lower rate than the lessee.

a True

b False