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Author Question: Which statement concerning capital structure theory is correct? (Read 321 times)

jrobl3

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on: Aug 7, 2023
Which statement concerning capital structure theory is correct?

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According to signalling theory, a stock issue sets off a positive signal, while using debt is a negative signal.


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Signalling theory suggests that a firm should try to use more debt in “normal” times than the MM trade-off theory would suggest.


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Signalling theory suggestsfirmsshouldinnormaltimesmaintainreserveborrowing capacity thatcanbe usedif anespecially good investmentopportunitycomesalong.


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Many of the corporate takeovers and leveraged buyouts in recent years were designed to improve efficiency by increasing the cash flow available to managers.

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by jrobl3 on Aug 7, 2023

butterfly17

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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jrobl3

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Reply 2 on: Aug 7, 2023
YES! Correct, THANKS for helping me on my review

brbarasa

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Reply 3 on: Yesterday
Excellent

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