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choose? Market value of the firm is = * Market value of equity + Market value of debt Firm value of equity + firm value

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Market value of the firm is = * Market value of equity + Market value of debt Firm value of equity + firm value of debt Dividend/Cost of Equity Interest/Cost of debt The amount of tax the firm would have paid, had it not incurred the interest * 2 point expense is known as Taxable income Tax shield Tax rebate Tax deductions

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