Explain how limited liability may affect the capital structure decisions of a corporation.
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Explain how limited liability may affect the capital structure decisions of a corporation
Explain how limited liability may affect the capital structure decisions of a corporation.
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Answer:The higher the debt ratio the greater the use of debt for financing operations vis-a-vis equity financing. Depending on your company and the industry you operate in a financial manager has to determine what level of debt is good for your capital structure.
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