When a Firm Employs No Debt

question 60

Multiple Choice

When a firm employs no debt

• A) it has a financial leverage of one.
• B) it has a financial leverage of zero.
• C) its operating leverage is equal to its financial leverage.
• D) it will not be profitable.

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Definitions:

True Experiments

Experimental designs in which the researcher manipulates the independent variable to observe its effect on a dependent variable, with random assignment to control and experimental groups.

Nutritional Benefits

Refers to the advantageous aspects of food substances that contribute to overall health and well-being, including support for body functions, energy, and disease prevention.

History Effect

As a threat to the internal validity of an experiment, refers to any outside event that is not part of the manipulation that could be responsible for the results.

Instrument Decay

As a threat to internal validity, the possibility that a change in the characteristics of the measurement instrument, including human observers, is responsible for the results.