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icang [17]
3 years ago
12

A management that wanted to increase the financial leverage of its firm would: raise additional capital by selling fixed interes

t rate long-term bonds. raise additional capital by selling common stock. use excess cash to purchase preferred stock for the treasury. try to increase its ROI by increasing asset turnover.
Business
1 answer:
Masteriza [31]3 years ago
7 0

Answer: Raise additional capital by selling fixed Interest rate long term bonds

Explanation:

A firm can finance it's operations through equity or debts, the art of a firm financing it's operations through debts like bonds etc it's refered to as financial leverage.

A firm cannot increase it's financial leverage by selling common stock, neither through buying stock from his cash and financial leverage does relate with asset turnover.

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Answer:

31 December 2019

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Stockholder theory

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