Increasing financial leverage can increase both the cost of debt, (rdebt), and the cost of equity, (requity)

Question:

Increasing financial leverage can increase both the cost of debt, (rdebt), and the cost of equity, (requity)· How can the overall stay constant? (Assume the firm pays no taxes.)
Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...