The Optimal Capital Structure Will Tend to Include More Debt

question 56

Multiple Choice

The optimal capital structure will tend to include more debt for firms with

• A)less taxable income.
• B)lower probability of financial distress.
• C)substantial tax shields from other sources.
• D)the lowest marginal tax rate.
• E)the highest depreciation deductions.

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Definitions:

Abolitionism

The movement aimed at ending slavery and the slave trade.

Hostile Audiences

Groups of individuals who are antagonistic, skeptical, or disagreeable towards the speaker or the message being presented.

Colonization Movement

A campaign in the 18th and 19th centuries aimed at resettling free Black Americans in Africa; the most well-known effort resulted in the establishment of Liberia.

Black Abolitionists

African American leaders and activists who played a significant role in the movement to end slavery in the United States before and during the Civil War.