Question
Sabrina invested in Sifuentes Co. stock when the firm was financed solely with equity. The firm is now utilizing debt in its capital structure. To
Sabrina invested in Sifuentes Co. stock when the firm was financed solely with equity. The firm is now utilizing debt in its capital structure. To unlever her position, Sabrina needs to
Multiple Choice
borrow some money and purchase additional shares of Sifuentes stock.
maintain her current position because the firm's use of leverage did not affect her.
sell some shares of Sifuentes stock and hold the proceeds in cash.
sell some shares of Sifuentes stock and lend out the sale proceeds.
sell some of her shares and borrow money to increase her cash reserves.
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Get StartedRecommended Textbook for
Fundamentals of Corporate Finance
Authors: Jonathan Berk, Peter DeMarzo, Jarrad Harford, David A. Stangeland, Andras Marosi
1st canadian edition
978-0133400694
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