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15. The trade-off theory of capital structure predicts that (all else equal): a. Firms with a larger proportion of intangible assets should have higher leverage
15. The trade-off theory of capital structure predicts that (all else equal): a. Firms with a larger proportion of intangible assets should have higher leverage ratios. b. Firms with more stable cash flows should have higher leverage ratios than firms with risky cash flows. 6. Rapidly growing firms should borrow more than mature firms. d. Increasing leverage increases firm value at high debt ratios
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