Business, 04.10.2020 08:01 karenjunior
Company X has a higher degree of financial risk than Company Y. Company X can offset this by lowering its operating leverage. True or false? Firm A has more business risk than Firm B, but they both have the same total risk. Which of the following statements must be true? a. In order to offset its higher business risk, Firm A will increase its operating leverage so that its total risk is the same as Firm B's. b. Because Firm A has more business risk than Firm B, its debt ratio will be greater than Firm B's. c. Because Firm B has less business risk than Firm A, its debt ratio will be lower than Firm A's. d. None of the statements above are true. The correct response is .
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Company X has a higher degree of financial risk than Company Y. Company X can offset this by lowerin...
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