Question: Which of the following statements is FALSE? O A. Growth will affect the optimal leverage ratio even if the firm has positive earnings. B.

Which of the following statements is FALSE? O A. Growth will affect

Which of the following statements is FALSE? O A. Growth will affect the optimal leverage ratio even if the firm has positive earnings. B. The more unsure we are of EBIT the more chance that interest will exceed EBIT, if the interest expense is high C. When examining tax, the optimal debt level is proportional to its current earnings. D. Growth rate of the firm is higher, it is more optimal to have a higher level of debt relative to equity in the firm capital structure.

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