Other things held constant,firms with more stable and predictable sales tend to use more debt than firms with less stable sales.

Question

Quizplus · Accepted Answer

Firms with stable and predictable sales are considered less risky by lenders, which means they are more likely to be approved for loans and can obtain better borrowing terms, allowing them to use more debt financing. On the other hand, firms with less stable sales are considered riskier and may have difficulty obtaining loans or have to pay higher interest rates to compensate for the increased risk.

Other Things Held Constant,firms with More Stable and Predictable Sales