9. Other things held constant, an increase in financial leverage will increase a

Question

9. Other things held constant, an increase in financial leverage will increase a firm's market (or systematic) risk as measured by its beta coefficient. a. True b. False   
9. Other things held constant, an increase in financial leverage will increase a firm's market (or systematic) risk as measured by its beta coefficient. a. True b. False   
9. Other things held constant, an increase in financial leverage will increase a firm's market (or systematic) risk as measured by its beta coefficient. a. True b. False   

Explanation / Answer

(a.) True is the answer. This is correct that if other things held constant, an increase in financial leverage will increase a firm's market risk as measured by its beta coefficient.

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