Which of the following is a reasonable conclusion from the, Ask an Expert

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Which of the following is a reasonable conclusion from the Tradeoff theory of capital structure?

a. A high debt ratio will result in a maximum price of a firm's common stock.

b. A firm's common stock price will not be affected by the amount of debt a firm uses.

c. Modest levels of debt have a more favorable impact on a firm's average cost of capital and stock price than no debt.

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Category:- Basic Finance
Reference No.:- M942830

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