All Else Equal, Which of the Following Activities Should Increase

question 7

Multiple Choice

All else equal, which of the following activities should increase the financial risk of a firm?

• A)decrease common stock dividends
• B)issue new bonds
• C)issue new common stock
• D)repurchase (pay off) outstanding debt
• E)an increase in the fixed operating costs

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Definitions:

Price Per Barrel

The cost of a barrel of commodities such as oil or other fluids, typically used in measuring large-scale transactions in the energy sector.

Minitab Output

The resultant data and graphs produced by Minitab, a statistical analysis software, after performing specified analyses.

Coefficient of Determination

A statistical measure, often denoted R², that represents the proportion of variance in the dependent variable predictable from the independent variable(s).

Coefficient of Correlation

A measure that indicates the extent to which two variables change together. If the value is close to 1 or -1, it indicates a strong relationship between the variables.