Typically,moving from a conservative to a moderate or aggressive financing strategy will result in __________ profitability and in _________ solvency for the company.

Question

Quizplus · Accepted Answer

Moving from a conservative financing strategy (which focuses on maintaining high levels of solvency) to a more aggressive one (which focuses on maximizing profits through increased leverage) will likely lead to greater profitability (due to increased borrowing and use of financial leverage) but lesser solvency (as the company assumes more risk through increased debt).

Typically,moving from a Conservative to a Moderate or Aggressive Financing