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All other factors held constant, if the government raises the corporate tax rate, ________. Select one: a. it increases a firm's incentive to use debt
All other factors held constant, if the government raises the corporate tax rate, ________.
Select one:
a. it increases a firm's incentive to use debt rather than equity financing
b. it will increase the value of the firm by a factor equal to one minus the tax rate
c. it does not change a firm's incentives regarding the use of debt or equity financing
d. it decreases a firm's incentive to use debt rather than equity financing
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