A market in which corporations raise funds through new issues of securities is referred to as a:

primary market.

spot market.

venture market.

dealer market

2. All else the same, firms facing relatively high tax rates should:

use more debt.

use less debt.

have lower E/E ratios.

none of these.

3. Which of the following is the condition in which a firm is near bankruptcy?

	Financial distress
	Call position
	Active capital structure
	Passive capital structure