When Might High Debt Levels Be a Benefit to an Organization

question 64

Multiple Choice

When might high debt levels be a benefit to an organization?

• A) When trying to make otherwise unaffordable investments
• B) When trying to prevent a leveraged buyout
• C) When determining earnings per share on common stock
• D) When calculating the current ratio to determine short-term solvency
• E) When the firm's short run credit risk is strong

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Definitions:

Repossession Companies

Businesses specialized in reclaiming property on behalf of a creditor when the borrower fails to keep up with contractual payments.

Law Enforcement Agencies

Organizations at various levels (local, regional, national) responsible for the enforcement of laws and prevention, detection, and investigation of crime.

LPR Companies

Companies specializing in License Plate Recognition technology, which uses optical character recognition on images to read vehicle registration plates.

Issues Of Privacy

Concerns and considerations related to the protection and handling of personal or sensitive information by individuals, organizations, or technology.