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Consider this table for firm YY: Weight of Equity (E/(D+E)) 0% 40% 60% 90% rWACC 12% 11% 13% 19% What is the firm's Optimal Weight
Consider this table for firm YY: Weight of Equity (E/(D+E)) 0% 40% 60% 90% rWACC 12% 11% 13% 19% What is the firm's Optimal Weight of Debt? Choose one answer and provide one reason. Hint: Read the table headings carefully. Group of answer choices Because this maximizes the PV of the firm's future Free Cash Flows 40% 90% Because this produces the highest EV/PE ratio. 60% Because this minimizes the PV of the firm's future Free Cash Flows Because maximum WACC coincides with the firm's maximum growth potential
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