1. A project's average net income divided by its average book value is referred to as the project's average:
A. net present value
B. internal rate of return
C. profitability index
D. accounting rate of return
2. Using debt and preferred stock in the capital structure of a firm will _____.
decrease business risk
increase the book value of common stock
increase the tax payable by the firm.
increase financial risk
decrease operating leverage