Buff Ltd$.$ is considering two choices for their capital structure:

Option A: All equity financing

Option B: Debt$-$equity ratio equal to $0\mathrm{.}25$

Which option is the best choice for Buff Ltd$.$ if its EBIT is less than the break$-$even level? $($Assume there are no taxes$)$

BBuff Ltd$.$ is considering two choices for their capital structure:

Option A: All equity financing

Option B: Debt$-$equity ratio equal to $0\mathrm{.}25$

Which option is the best choice for Buff Ltd$.$ if its EBIT is less than the break$-$even level? $($Assume there are no taxes$)$

Because the debt$-$equity ratio is less than half, Buff Ltd$.$ should choose the leverage option

Buff Ltd$.$ should choose the unlevered option since its EBIT is less than the break$-$even level

Buff Ltd$.$ should choose the unlevered option since the debt$-$equity ratio is less than half

None of the above as the information provided is insufficientecause the debt$-$equity ratio is less than half, Buff Ltd$.$ should choose the leverage option

Buff Ltd$.$ should choose the unlevered option since its EBIT is less than the break$-$even level

Buff Ltd$.$ should choose the unlevered option since the debt$-$equity ratio is less than half

None of the above as the information provided is insufficient