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Assume a firm has a debt-equity ratio of .48. The firm's cost of equity is: directly related to the risk level of the firm, generally

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Assume a firm has a debt-equity ratio of .48. The firm's cost of equity is: directly related to the risk level of the firm, generally less than its WACC. Inversely related to changes in the level of inflation. generally less than the firm's aftertax cost of debt. unaffected by changes in the market risk premium

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