When Using Equity Financing, Firms Run the Risk of ________

question 60

Multiple Choice

When using equity financing, firms run the risk of ________.

• A)losing a controlling interest to shareholders
• B)acquiring capital through the sale of shares
• C)incurring an unmanageable amount of debt
• D)falling victim to currency exchange rates

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Definitions:

Fixed Costs

Costs that do not vary with the level of production or sales, remaining constant regardless of the scale of operations.