Consider the following two potential transactions: $($i$)$ sell the government bond securities; and $($ii$)$ use the proceeds from borrowing to buyback its own shares. Assume this is an NFA firm. The combination of two financial transactions will

A$.$ reduce the financial leverage $($FLEV$)$ and the firm will continue to be an NFA firm.

B$.$ reduce the financial leverage $($FLEV$)$ and the firm will switch to an NFO firm.

C$.$ increase the financial leverage $($FLEV$)$ and the firm may become be an NFO firm.

D$.$ increase the financial leverage $($FLEV$)$ and the firm cannot be an NFA firm anymore.