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Why might this not be the best capital structure d

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Unformatted text preview: your findings in parts c and d, which capital structure would you recommend? Why? WEB EXERCISE WW W Go to the Web site www.smartmoney.com. In the column on the right under Quotes & Research enter the symbol DIS; click on Stock Snapshot; and then click on Go. 1. What is the name of the company? Click on Financials. 2. What are the 5-year high and the 5-year low for the company’s debt/equity ratio (the ratio of long-term debt to stockholders’ equity)? At the bottom of this page under Stock Search, enter the next stock symbol from the list below and then click on Submit. Enter the name of the company in the matrix below and then click on Financials. Enter the 5-year high and low for the debt/equity ratio in the matrix for each of the stock symbols. Debt/equity ratio Symbol DIS AIT MRK LG LUV IBM GE BUD PFE INTC Company name 5-yr. low 5-yr. high CHAPTER 12 Leverage and Capital Structure 3. Which of the companies have high debt/equity ratios? 4. Which of the companies have low debt/equity ratios? 5. Why do the companies that have a low debt/equity ratio use more equity even though it is more expensive than debt? Remember to check the book’s Web site at www.aw.com/gitman for additional resources, including additional Web exercises. 557...
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