Firms in industries that are cyclical, oriented toward research, or subject to huge liability suits normally will maintain high levels of debt in their capital structure.

Question

Quizplus · Accepted Answer

Firms in cyclical industries, those focused on research, or those facing large liability risks typically maintain lower levels of debt to avoid financial distress during downturns or uncertain periods.

Firms in Industries That Are Cyclical, Oriented Toward Research, or Subject