The pecking order view of capital structure suggests that for financing new projects, firms prefer...
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The pecking order view of capital structure suggests that for financing new projects, firms prefer borrowing (debt) over issuing more equity. Internally generated funds over borrowing. Equity over debt. Paying out all of the firm's earnings as dividends to existing shareholders to maximize shareholders' wealth. BOTH borrowing (debt) over issing more equity, AND also internally generated funds over borrowing (in other words, both of these options (statements) are correct
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