When Might High Debt Levels Be a Benefit to an Organization

question 64

Multiple Choice

When might high debt levels be a benefit to an organization?

• A) When trying to make otherwise unaffordable investments
• B) When trying to prevent a leveraged buyout
• C) When determining earnings per share on common stock
• D) When calculating the current ratio to determine short-term solvency
• E) When the firm's short run credit risk is strong