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Explain why publicly held companies use debt in their capital structure. What are the advantages to a corporation of using long-term debt? What are the

  1. Explain why publicly held companies use debt in their capital structure.
  2. What are the advantages to a corporation of using long-term debt?
  3. What are the disadvantages?
  4. As a potential investor in a publicly held company:
  5. How would you evaluate the companys use of debt?
  • At what level of debt would you become cautious about investing?

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