What Is the Major Source of Long-Term Debt Financing for Most

question 30

Multiple Choice

What is the major source of long-term debt financing for most large corporations?

• A) Corporate bonds
• B) Long-term loans
• C) Trade credit
• D) Equity financing
• E) Retained earnings

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Definitions:

Earnings

The amount of profit that a company produces during a specific period, indicative of its financial health and performance.

Dividend Payments

Cash or stock distributed by a company to its shareholders out of its profits or reserves.

Signaling

The act of using information to convey a message about the quality or desirability of a product, service, or investment, often in situations where there is asymmetric information.

Dividend Policy

A company's approach to distributing profits to its shareholders, determining the size and timing of dividend payments.