The Pecking Order Theory of Capital Structure Suggests That Firms

question 2

Multiple Choice

The pecking order theory of capital structure suggests that firms follow which order when raising capital?

• A)Internal cash flow, issue debt, issue equity
• B)Internal cash flow, issue equity, issue debt
• C)Issue debt, internal cash flow, issue equity
• D)Issue debt, issue equity, internal cash flow

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Definitions:

Disciplinary Action

Measures taken by an employer or organization against its members or employees for violating rules or standards of conduct.

Employee Performance

An assessment of how effectively an employee completes their job duties and meets set objectives within a work environment.

Mandatory Arbitration Agreement

A contract clause requiring parties to resolve disputes through arbitration rather than in court, usually as a condition of employment.

Disputes

Conflicts or disagreements between parties, such as between employers and employees, often related to labor issues or contractual matters.