question_answer

Direction:  In the questions given below are two statements labelled as Assertion (A) and Reason (R). In the context of the two statements, which one of the following is correct?

Assertion (A) Risk principle of capital structure is one that minimise cost of capital structure.

Reason (R) According to this principle, reliance is placed more on equity for financial purpose.

Codes

A)                                  Both A and R are true and R is the correct explanation of A

B)  Both A and R are true, but R is not the correct explanation of A

C)  A is true, but R is false

D)  A is false, but R is true