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debt equity ratio
if a government company wholly owned by government has huge cash reserves and it pays all of its debt and debt equity ratio becomes 0 then what will be it's financial implication???.
Replies (1)
these are debt free companies.
Pro's: 1. High solvency
2. High profit margin
3. Low Break Even Point
Con's: 1. Low EPS
2. Higher cost of capital (Debt is cheaper than Equity)
3. No Tax Benefit.
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