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According to the Tax Shield Hypothesis,we Should Expect to Find

Question 21

Multiple Choice

According to the tax shield hypothesis,we should expect to find:


A) a negative relationship between companies with high non-debt tax shields and companies with low debt/equity ratios.
B) a positive relationship between companies with high non-debt tax shields and companies with high debt/equity ratios.
C) a positive relationship between companies with high non-debt tax shields and companies with low debt/equity ratios.
D) a positive relationship between companies with low non-debt tax shields and companies with low debt/equity ratios.

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