Financial leverage characteristic of long-term debt

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Reference no: EM13138166

The financial leverage characteristic of long-term debt results in:

a. a reduction of the risk that creditors will not be paid.

b. a magnification of ROE relative to what it would be without long-term debt.

c. a magnification of ROI relative to what it would be without long-term debt.

d. the deductibility, for income tax purposes, of dividends to stockholders.

Reference no: EM13138166

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