The Optimal Capital Structure for Firms in Cyclical Industries Should

question 80

Multiple Choice

The optimal capital structure for firms in cyclical industries should contain ________________ than firms in stable industries.

• A) more debt
• B) less debt
• C) an equal amount of debt
• D) none of these. There is no relationship between the cyclical nature of an industry and optimal capital structure.

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Definitions:

Conflict

A struggle between opposing forces or interests, which can occur on individual, group, or societal levels.

Structural Strain Theory

A theory that interprets deviance as originating in the tensions that exist in society between cultural goals and the means people have to achieve those goals.

Cultural Goals

The aims and objectives that a society values and encourages its members to strive towards.

Anomie

A state or condition of society or an individual characterized by a breakdown or absence of social norms and values, often leading to feelings of alienation.