Horizon Mortgage is considering issuing $2.5 million in bonds. The finance department at Horizon has stated that issuing the bonds will decrease the value of the firm. Accordingly, you know the finance department believes the firm: wants to issue too few bonds to obtain the most benefit from debt. will suffer from a decrease in its WACC if the bonds are issued. is at, or has exceeded, its optimal debt-equity ratio. will realize greater tax benefits by issuing equity securities. currently is all-equity financed and adding debt will cause a decrease in firm value.