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New CPPP-001 Test Voucher - GAQM Real CPPP-001 Dumps, Test CPPP-001 Engine Version - Kolis

  • Exam Number/Code : CPPP-001
  • Exam Name : Certified Professional Python Programmer (CPPP)
  • Questions and Answers : 260 Q&As
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NEW QUESTION: 1
Which one of the following factors might cause a firm to increase the debt in its financial structure?
A. A decrease in the times interest earned ratio.
B. Increased economic uncertainty.
C. An increase in the price/earnings ratio.
D. An increase in the corporate income tax rate.
Answer: D
Explanation:
Choice "a" is correct. An increase in the corporate income tax rate might cause a firm to increase the debt
in its financial structure because interest is tax deductible, while dividends are paid after-tax. Choice "b" is
incorrect. Increased economic uncertainty would cause a firm to decrease debt (and interest cost). Choice
"c" is incorrect. An increase in the price/earnings ratio would encourage the issuance of equity rather than
debt. Choice "d" is incorrect. A decrease in the times interest earned ratio indicates that earnings have
declined compared with interest, and that more debt would be unwise (and more difficult to negotiate).

 

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Eleanore - 2014-09-28 16:36:48
New CPPP-001 Test Voucher - GAQM Real CPPP-001 Dumps, Test CPPP-001 Engine Version - Kolis


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