As a firm keeps adding leverage, one risk keeps rising. That risk is:

Question

Accepted Answer

D. Financial distress

1. Fixed payments grow.
2. The firm may struggle to meet them.
3. It is financial distress.
_Source: OpenStax Principles of Finance 2e, Chapter 17, How Firms Raise Capital._

Answer

Employee boredom

Answer

Office overcrowding

Answer

Excess inventory

As a firm keeps adding leverage, one risk keeps rising. That risk is:

Keep practising Cost of Capital