Which of the Following Is a Good Reason for a Company

question 92

Multiple Choice

Which of the following is a good reason for a company to have higher than average debt ratios?

• A) The company's cash flows are difficult to predict.
• B) The company generates little taxable income.
• C) Customer support is an important aspect of the company's business.
• D) The company faces high marginal tax rates.

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Definitions:

Market Pressures

The forces exerted by supply and demand within a marketplace that influence business decisions, product pricing, and economic policies.

High Profiles

Entities or individuals receiving a significant amount of public attention or media coverage, often due to their status, actions, or positions.

Customer Service

The assistance and advice provided by a company to those people who buy or use its products or services.

Low Wages

Compensation amounts paid to workers that are significantly below the average for their sector or region.