Which of the Following Events Is Likely to Encourage a Company

question 70

Multiple Choice

Which of the following events is likely to encourage a company to raise its target debt ratio, other things held constant?

• A) An increase in the personal tax rate.
• B) An increase in the company's operating leverage.
• C) The Federal Reserve tightens interest rates in an effort to fight inflation.
• D) The company's stock price hits a new high.
• E) An increase in the corporate tax rate.

---

Definitions:

Change

The transformation or modification of an organization and/or its stakeholders.

Diagnostic Activities

Tasks or processes undertaken to identify problems, analyze causes, and determine solutions in various contexts.

Informal Elements

Components within an organization that are not officially documented or structured but contribute to the culture, such as norms, behaviors, and unwritten rules.

Organizational Development

A field of research, theory, and practice dedicated to expanding the knowledge and effectiveness of people to accomplish more successful organizational change and performance.