Suppose you work for the CFO of Danforth, Inc. He believes sales and operating income will be sharply higher each year for the foreseeable future. If he seeks to maximize earnings per share, he
Should _____________. (Assume there are no taxes.)
A) Increase the ﬁrm's debt to equity ratio.
B) Increase the ﬁrm's debt to equity ratio if the ﬁrm's EBIT will remain below the break-even (comparing levered to unlevered) level of EBIT.
C) Decrease the ﬁrm's debt to equity ratio.
D) Not change the ﬁrm's debt to equity ratio.
E) Decrease the ﬁrm's debt to equity ratio if the ﬁrm's EBIT will remain below the break-even (comparing levered to unlevered) level of EBIT.

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The Answer of Suppose you work for the CFO of Danforth, Inc. He believes sales and operating income will be sharply higher each year for the foreseeable future. If he seeks to maximize earnings per share, he
Should _____________. (Assume there are no taxes.)
A) Increase the ﬁrm's debt to equity ratio.
B) Increase the ﬁrm's debt to equity ratio if the ﬁrm's EBIT will remain below the break-even (comparing levered to unlevered) level of EBIT.
C) Decrease the ﬁrm's debt to equity ratio.
D) Not change the ﬁrm's debt to equity ratio.
E) Decrease the ﬁrm's debt to equity ratio if the ﬁrm's EBIT will remain below the break-even (comparing levered to unlevered) level of EBIT.

Suppose You Work for the CFO of Danforth, Inc