QUESTION 23

1. The pecking order theory of capital structure is based on the asymmetric information theory that the announcement of a stock offering by a mature firm is taken as a signal that the firm's prospects as seen by its management are not bright.

True

False

1 points

QUESTION 24

1. One implication of the pecking order theory of capital structure is that profitable firms have more debt because they don't need outside money.

True

False