Which of the following statements is correct? - 3760

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Which of the following statements is correct?

          a.   In general, a firm with low operating leverage has a small proportion of its total costs in the form of fixed costs.

          b.   An increase in the personal tax rate would not affect firms’ capital structure decisions.

          c.   A firm with high business risk is more likely to increase its use of financial leverage than a firm with low business risk, assuming all else is equal.

          d.   All of the above are correct.

          e.   None of the above is correct.

 

Solution Description

Which of the following statements is correct?