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1. How has academic theory influenced investor behavior? 2. How does risk tolerance affect the type of portfolio a person should build? 3. Why are

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1. How has academic theory influenced investor behavior? 2. How does risk tolerance affect the type of portfolio a person should build? 3. Why are investors indifferent to the firm's capital structure? 4. With perfect capital markets, as a firm increases its leverage, how does its debt cost of capital change? Its equity cost of capital? lts weighted average cost of capital

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