Corporations in the U.S.tend to:
A)have extremely high debt-equity ratios.
B)rely less on equity financing than they should.
C)underutilize debt.
D)maximize taxes.
E)rely more heavily on bonds than stocks as the major source of financing.

Question

Quizplus · Accepted Answer

Corporations in the U.S. tend to underutilize debt, meaning they rely less on borrowing and more on equity financing. This is due to reasons such as the fear of bankruptcy, the cost of borrowing, and the desire to maintain control of the company. As a result, their debt-equity ratios tend to be lower than those in other countries.

Corporations in the U.S.tend To