A valuable firm will tend to:

• A.see its stock price increase if it issues debt beyond its optimal debt level.
• B.issue more debt than a less valuable firm of comparable size.
• C.reduce its debt level as a positive signal for the firm.
• D.issue debt, but only on a temporary basis purely to fool investors regarding the firm's value.
• E.see its stock price increase when it announces an exchange offer that decreases its leverage.