In most ________,the debt capital usually exceeds the equity by a ratio of 5:1.
A) mergers
B) leveraged buyouts
C) hostile takeovers
D) franchises

Question

Quizplus · Accepted Answer

In leveraged buyouts, the acquiring company typically uses a significant amount of debt to finance the purchase of the target company. This results in a higher ratio of debt capital to equity capital, often around 5:1. The other options listed do not necessarily have this same financing structure.

In Most ________,The Debt Capital Usually Exceeds the Equity by a Ratio