The current weighted average cost of capital (WACC) for Van der Welde is 10%. The company announced
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The current weighted average cost of capital (WACC) for Van der Welde is 10%. The company announced a debt offering that raises the WACC to 13%. The most likely conclusion is that for Van der Welde:
A. the company’s prospects are improving.
B. equity financing is cheaper than debt financing.
C. the company’s debt/equity ratio has moved beyond the optimal range.
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C the companys debtequity ratio has moved beyond the optimal range Explanation The weighte...View the full answer
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Related Book For 
Corporate Finance A Practical Approach
ISBN: 9781118217290
2nd Edition
Authors: Michelle R Clayman, Martin S Fridson, George H Troughton, Matthew Scanlan
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