if-a-company-finances-its-assets-primarily-through-liabilities-rather-than-equit

Question

If a company finances its assets primarily through liabilities rather than equity, what is the likely implication for its financial structure?

Accepted Answer

The company has higher financial leverage.

Answer

The company will have lower interest expenses.

Answer

The company has less risk of insolvency.

Answer

The company will have more equity.