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NEW QUESTION: 3
Pecking order theory states that, when financing new investment opportunities, a business will prefer to use:
1.Internal finance rather than external finance.
2.Equity rather than debt.
Which ONE of the following combinations (true/false) concerning the above statements is correct?
A. Statement 1 = False, Statement 2 = False
B. Statement 1 = True, Statement 2 = False
C. Statement 1 = False, Statement 2 = True
D. Statement 1 = True, Statement 2 = True
Answer: B

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