What capital structure (e.g. percentage debt and equity) is an engineering design company likely to have if their cashflows are highly variable and why?

Question

Answer

90% debt and 10% equity because engineering firms are not worthy.

Answer

50% debt and 50% equity because engineering firms have high margins.

Answer

70% debt and 30% equity because engineering services are always needed.

Answer

10% debt and 90% equity due to the need to ensure repayment of debt obligations.

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75% debt and 25% equity because interest on borrowed funds is taxable.

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What capital structure (e.g. percentage debt and equity) is an engineering desig...

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