Debt Financing Affects Neither the Operating Risk nor the Business

question 124

True/False

Debt financing affects neither the operating risk nor the business risk of the firm.However,if there is less equity outstanding,a change in operating income has a greater impact on earnings per share.

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Definitions:

Professional Courtesy

A practice among professionals of providing services to each other at reduced rates or without charge.

Medical Provider

A healthcare professional or organization that provides health care services, including diagnosis, treatment, and preventive care.

Healthcare Professionals

Individuals who work in various sectors of healthcare, providing medical services, treatments, and advice to patients.

Credit Card

A plastic card issued by a bank or financial institution allowing the holder to borrow funds at point of sale, subject to the agreement of repayment with interest.