If the Firm Decreases Its Debt Ratio,both the Debt and the Equity

question 104

True/False

If the firm decreases its debt ratio,both the debt and the equity will become riskier.The debtholders and equity holders require a higher return to compensate for the increased risk.

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Definitions:

Work Ethic

A set of values based on the virtues of hard work and diligence, emphasizing the importance of responsibility, integrity, and perseverance in professional settings.

Outside the Home

Activities or work performed away from one's residence, often relating to employment or socialization in public or communal spaces.

David Reisman

A noted American sociologist best known for his work on the theory of social character and the book "The Lonely Crowd", examining changes in American character and society.

Work Ethic

The principle that hard work is intrinsically virtuous or worthy of reward, often emphasizing diligence, discipline, and efficiency in one's professional life.