FIN 534 RANK Imagine Your Future /fin534rank.com FIN 534 RANK Imagine Your Future /fin534rank.com - Page 28

• Question 14 Which of the following statements is CORRECT? • Question 15 Two operationally similar companies, HD and LD, have the same total assets, operating income (EBIT), tax rate, and business risk. Company HD, however, has a much higher debt ratio than LD. Also HD's basic earning power (BEP) exceeds its cost of debt (rd). Which of the following statements is CORRECT? • Question 16 Which of the following events is likely to encourage a company to raise its target debt ratio, other things held constant? • Question 17 A lockbox plan is