C为什什么是错的

问题如下：

For a mature company to utilize significant leverage in its capital structure, which industry is most likely to fit this description?

选项：

A.

Technology

B.

Transportation

C.

Mining

解释：

A is incorrect. Technology companies, especially those focused on software, tend to have capital-light business models with low fixed asset requirements and high asset turnover, making substantial leverage less common compared to more capital-intensive industries.

B is correct. Transportation, along with utilities and real estate, is identified as a capital-intensive industry. These sectors often require significant investment in tangible assets like vehicles and infrastructure, which can serve as collateral for debt, enabling these companies to support higher levels of leverage.

C is incorrect. A mining company will be more likely to raise equity funding than debt funding. In cyclical sectors, such as mining and minerals, and many industrials, revenues and cash flows vary widely through the economic cycle, which limits debt capacity. As a result, businesses in cyclical sectors may have less debt in their capital structures than companies in other less cyclical industries.