All of the following would likely cause a firm to raise capital at a lower cost except:
A) Higher times interest earned
B) Higher profit margin
C) Increased market share
D) Higher debt to asset ratio

Question

Quizplus · Accepted Answer

A higher debt to asset ratio indicates that the company is more risky and may have difficulty paying back debt, which would increase the cost of capital. Higher times interest earned, higher profit margin, and increased market share all indicate that the company is financially stable and profitable, which could lead to lower cost of capital.

All of the Following Would Likely Cause a Firm to Raise