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To aid in her decision of whether to issue bonds or stock, a CFO has prepared a range of earnings chart for her company, as
To aid in her decision of whether to issue bonds or stock, a CFO has prepared a range of earnings chart for her company, as shown below. Which of the following changes (holding all else equal) would increase the crossover EBIT in the range of earnings chart?
Multiple Choice
An increase in the interest rate on the bonds to be issued.
A decrease in the companys stock price.
Increased uncertainty about the companys future earnings.
An increase in cash dividends paid on the companys common stock.
None of the options are correct.
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