Which of the following company actions will have no effect on its Leverage Ratio?
a) It issues (sells) new equity shares and uses the money to purchase equipment
b) It issues (sells) new equity shares and uses the money to pay off exactly that amount in bank loans
c) It issues (sells) a bond and uses the money to pay off exactly that amount in bank loans
d) It issues (sells) a bond and uses the money to return to owners
Answer: c) It issues (sells) a bond and uses the money to pay off exactly that amount in bank loans
Business
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