A Firm with Highly Liquid Assets Plus Unused Debt Capacity

question 64

Multiple Choice

A firm with highly liquid assets plus unused debt capacity is said to have ____.

• A) arbitrage structural capacity
• B) the optimal capital structure
• C) financial slack
• D) optimal financial structure

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Definitions:

Amino Acids

Compounds that function as the primary elements in the formation of proteins, each characterized by a specific arrangement of nitrogen, carbon, hydrogen, and oxygen.

Chemical Digested

The process of breaking down substances into simpler components through chemical reactions, usually referring to the digestion of food.

Brush Border Cells

Epithelial cells found in the intestinal lining and kidney, characterized by a densely packed layer of microvilli on their apical surface to enhance absorption.

Absorbed

The process by which substances are taken into a more condensed form or into a different medium, such as liquids being taken up by solids.