Which of the Following Statements Is True

Which of the following statements is true?

A) Financial theorists have resolved the issue of how to maximize firm value by altering capital structure.
B) Firms increase their debt usage when markets overvalue the firm.
C) Firms with a high degree of operating leverage usually maintain high debt ratios.
D) A firm's long-term earnings are more important than its near-term cash flows in determining the amount of debt to issue.
E) A highly leveraged firm has less flexibility to take advantage of investment opportunities than companies with low debt ratios.