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:

Correlation Coefficient

A statistical measure that describes the extent to which two variables change together, and the direction of this relationship.

Squared Value

A mathematical term that refers to a number multiplied by itself.

Variability

A measure of the spread or dispersion of a set of data points within a dataset.

Regression Equation

A mathematical formula used to predict a dependent variable based on one or more independent variables.