Compared With An Otherwise Identical All Equity Financed Firm One That Uses Debt

COMPARED WITH AN OTHERWISE IDENTICAL ALL EQUITY FINANCED FIRM, ONE THAT USES DEBT WILL HAVE:

A) LOWER RISK B) A LOWER DEGREE OF FINANCIAL LEVERAGE C) LESS RISK OF BANKRUPTCY D) LOWER AGENCY COSTS OF DEBT E) GREATER VARIATION IN EPS AND ROE

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