Managers Should Consider ________ for External Financing When Agency Costs

question 85

Multiple Choice

Managers should consider ________ for external financing when agency costs are significant.

• A)long-term debt
• B)retained earnings
• C)internal equity
• D)short-term debt
• E)preferred stock

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Definitions:

Coefficient

A numerical constant placed at the beginning and serving as a multiplier to a variable in an algebraic formula.

Nominal Variables

Variables that represent categories without any inherent order or ranking among them.

Interaction Term

A variable in statistical models that captures the effect of two or more variables simultaneously affecting a response variable.

Significance Level

The probability of inappropriately disapproving the null hypothesis in a study of statistics, generally labelled as alpha.