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    Corporate Finance Study Set 5
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    Exam 16: Debt Policy
  5. Question
    Debt Financing Affects Neither the Operating Risk nor the Business
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Debt Financing Affects Neither the Operating Risk nor the Business

Question 124

Question 124

True/False

Debt financing affects neither the operating risk nor the business risk of the firm.However,if there is less equity outstanding,a change in operating income has a greater impact on earnings per share.

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