They should meet stakeholder responsibilities if that is what the question is asking, are there any options
Answer:
a) an interior optimum (firm value maximizing) debt ratio
Explanation:
Trade off Theory is about capital structure of an economic unit. It mentions about the benefit of debt - ie tax saving, as interest on debt is tax deductible; & cost of debt - bankruptcy & insolvency risk, due to fix interest cost.
The theory depicts the debt level, which is best to - balance interest tax shield against the costs of financial distress imply, which implies that it seeks a balance between benefit & cost of debt.
So, the theory finds the best interior optimum (firm value maximising) debt equity ratio.
Answer:
The issue price will be above the bond's face value.
Explanation:
Answer:
The correct answer is letter "C": the effect of the decrease in price on total revenue dominates the effect of the increase in quantity demanded on total revenue; overall total revenue declines.
Explanation:
Goods or services have inelastic demand when changes in prices do not affect their quantity demanded. If prices decrease or increase, the quantity demanded will remain at the same level or the change will be so minimal that it is not perceived. It is said then that <em>the decrease in price dominates the effect of the changes in quantity demanded.
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However, <em>if prices decrease and the quantity demanded remains the same, the company's overall revenue will decrease.</em>
