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Author Question: If the static trade-off theory is correct, then which of the following does NOT lead to a more ... (Read 24 times)

2125004343

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on: Apr 25, 2021

Question 1

If a company is near bankruptcy and shareholders approve a long-shot project with a negative NPV this is an example of
◦ a direct cost of financial distress.
◦ an indirect cost of financial distress.
◦ an agency benefit of debt.
◦ an agency cost of debt.

Question 2

If the static trade-off theory is correct, then which of the following does NOT lead to a more leveraged optimal capital structure?
◦ High corporate tax rate
◦ Lower financial distress costs
◦ Greater agency benefits (i.e., reduced managerial waste of free cash flow) from debt
◦ Greater agency costs from debt
Corporate Finance Online ¦ Eakins, McNally ¦ 2nd Edition
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Marked as best answer by 2125004343 on Apr 25, 2021

Koolkid240

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Reply #1 on: Apr 25, 2021
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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2125004343

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Reply 2 on: Apr 25, 2021
Great answer, keep it coming :)

pratush dev

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

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