Ask Question
BusinessBusiness
8 October, 23:47

When a firm changes its capital structure by issuing or retiring debt, for example, this change alters the firms unlevered free cash flow. True / False.

+5
Answers (1)
  1. 9 October, 00:28
    0
    True

    Explanation:

    Unlevered free cash flows represent the amount of cash a business has before meeting it's financial obligations such as operating expenses or periodic interest payments on borrowed funds.

    When a firm issues further debt, it's available funds increase. Similarly, if a firm retires or repays it's debt, it's available funds decrease.

    Therefore, change in capital structure by issue or retirement of debt alters a firm's unlevered free cash flows.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “When a firm changes its capital structure by issuing or retiring debt, for example, this change alters the firms unlevered free cash flow. ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
How do insurance companies make money
Answers (1)
A cartel is A. a government agency that regulates markets. B. an arbitrator to settle disputes between consumers and producers. C. a group of producers that agree to set common prices and output quotas. D.
Answers (1)
Mr. Hobbes Bed & Breakfast is considering the replacement of some old equipment. The new equipment will cost $86,000 including delivery and installation.
Answers (1)
Systematic risk refers to: movements in a stock portfolio's value that are attributable to macroeconomic forces affecting all firms in an economy. the level of diversifiable risk in an economy.
Answers (1)
A written agreement is called what a. contract b. solvency c. investment d. tariff
Answers (1)
New Questions in Business
true or false Activity cost pools are factory overhead costs initially budgeted for activities, such as machine usage, inspections, moving, production setups, and engineering activities.
Answers (1)
Prepare the Statement of Cash Flows for Smart Touch Learning for the month ended December 31, 2016 from the provided information. Within each section of the statement, use the drop-down menus to enter the accounts.
Answers (1)
A company is considering purchasing a machine for $21,000. The machine will generate an after-tax net income of $2,000 per year. Annual depreciation expense would be $1,500. What is the payback period for the new machine? a. 4 years. b. 6 years. c.
Answers (1)
A company purchased a delivery van for $15,500 with a salvage value of $2,300 on September 1, Year 1. It has an estimated useful life of 4 years.
Answers (1)
Money has a time value because
Answers (1)
Home » Business » When a firm changes its capital structure by issuing or retiring debt, for example, this change alters the firms unlevered free cash flow. True / False.
Sign Up Forgot Password?