The APV model uses the unlevered cost of equity, r sU , to discount cash flows while

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The APV model uses the unlevered cost of equity, r_sU, to discount cash flows while the corporate valuation model uses the WACC. Explain why the two models use different discount rates.

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Intermediate Financial Management

ISBN: 9780357516669

14th Edition

Authors: Eugene F Brigham, Phillip R Daves

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Question Posted: Feb 24, 2023 06:26 AM

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The APV model uses the unlevered cost of equity, r sU , to discount cash flows while

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The corporate valuation model takes the value of the debt tax shield int...View the full answer

Intermediate Financial Management

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