Q. Which of the following statements is correct for an aggressive financing policyfor a firm relative to a former conservative policy? (Solved)

1. the firm will use long-term financing to finance all fixed and current assets.

2. the firm will see an increase in its expected profits.

3. the firm will see a decline in its risk profile.

4. the firm will need to issue additional common stock this period to finance the assets.

  • b. the firm will see an increase in its expected profits.
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