Managers Should Not Change the Capital Structure Unless It Departs

question 87

Multiple Choice

Managers should not change the capital structure unless it departs significantly from the optimal level because such a change would ________.

• A) reduce dividends
• B) incur transactions costs
• C) increase fixed costs
• D) change incentives of stakeholders

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Definitions:

Heavy-Metal Poisoning

A condition caused by the accumulation of toxic heavy metals in the body, leading to various health problems.

Urinary Parasite

Parasites that inhabit the urinary tract, causing infections and other health issues.

Escherichia Coli

A type of bacteria commonly found in the intestines of humans and animals, some strains of which can cause food poisoning.

Trichomoniasis Vaginalis

A sexually transmitted infection caused by the parasite Trichomonas vaginalis, leading to vaginal discharge and itching.