Question: Consider a company that has leverage ( Debt / Debt + Market cap ) = 1 2 % and a credit rating of A -

Consider a company that has leverage (Debt / Debt + Market cap)=12% and a credit rating of A-. Which of the following options is incorrect?
Group of answer choices
This company is likely to be able to issue additional debt without reducing firm value.
This companys optimal leverage ratio is likely to be higher than 15%.
This companys leverage ratio is higher than the leverage ratio for the median US public firm.
This company would likely benefit from corporate policies that would increase its leverage ratio, such as issuing additional debt.

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