According to the pecking-order theory

Assignment Help Financial Management

Reference no: EM131088322

According to the pecking-order theory, a firm’s leverage ratio is determined by:

the market rate of interest.

the profitability of the firm.

equating the tax benefit of debt to the financial distress costs of debt.

the value of the tax benefit of debt.

the firm’s financing needs.

Reference no: EM131088322

Questions Cloud

State whether each member is in tension or compression : State whether each member is in tension or compression.

Forward rates between the rand : On 20 May 2016, the spot and forward rates between the rand and the USD(ZAR/USD) were as follows:

How much time is required to bring the density : If the mass diffusivity of hydrogen is 9 X 10-7 m2/s, how much time is required to bring the density of dis- solved hydrogen to a value of 1.2 kg/m3 at the center of the sheet?

Government and foreign sectors : In the simple Keynesian model with no government and foreign sectors, suppose that initially the economy is in equilibrium at an output of $10 trillion with a marginal propensity to consume of 0.8. If investment spending increases by $0.5 trillion..

According to the pecking-order theory : According to the pecking-order theory, a firm’s leverage ratio is determined by:

Apply gaap for proper revenue recognition : S5-6 (Learning Objective 2: Apply GAAP for proper revenue recognition) Refer to the facts in S5-5. The sales terms on the invoice are 2/10, net 30. What does this mean? What is Sports R Us' potential savings, if any? How much time does the company..

What is the rate of return if the cash value : if a person age 25 can buy a $100000 life paid up at age 65 insurance policy for $1200 per year: a) what is the rate of return if the cash value at age 65 is $167591? b)what is the rate of return, if the person purchases a $150000 life paid up at age..

Interest rate on swiss france : Suppose the one-year interest rate on Swiss France is 10% and the US Dollar interest rate is 12% and the current $/SF spot rate is 0.8. What do you expect the 12-month forward rate by using the interest rate parity?

How much life insurance should a person : how much life insurance should a person have if he/she desires do provide the following income for his/her beneficiaries? $60000 per year for 10 years beginning immediately and $48000 per year beginning in the 11th year and continuing for 20 more yea..

User Account

All Pages