Question
can someone answer these for me plz 17. According to the Pecking Order Theory, a firm needing outside financing should first finance using A. Initial
can someone answer these for me plz
17. According to the Pecking Order Theory, a firm needing outside financing should first finance using
A. Initial Public Offering of stock
B. Seasoned Equity Offering of stock
C. Seasoned Equity Offering of preferred stock
D. Convertible preferred stock
E. None of the above
18. According to the Market-Timing Model
A. Firms issue equity when stock prices are high and debt when stock prices are low
B. A firms capital structure reflects the cumulative effects of past attempts to issue equity opportunistically
C. Firms issue equity when stock prices are high and equitywhen stock prices are low
D. Firms always adhere to a target debt/equity ratio
E. Both A and B
19. How could bankruptcy have no consequence for a firms capital structure?
A. If bankruptcy laws were rewritten to favor debtors
B. If there were no direct or indirect costs to bankruptcy
C. If Hillary had been elected president
D. If bankruptcy represented a costly transfer to creditors
E. None of the above
________ 20. If a company has too little debt in its capital structure, then
A. It is taking excessive interest expense deductions
B. It has no non-debt tax shields
C. It likely has too little equity
D. It should increase its leverage
E. None of the above
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