Other things held constant,firms that use assets that can be sold easily (like trucks)tend to use more debt than firms whose assets are harder to sell (like those engaged in research and development).

Question

Quizplus · Accepted Answer

This is because easy-to-sell assets are more liquid and can be used as collateral for loans, making it easier for the firm to obtain financing. Hard-to-sell assets, on the other hand, may be less attractive to lenders and therefore the firm may rely less on debt financing.

Other Things Held Constant,firms That Use Assets That Can Be