Question
If the corporate tax rate is zero and there is no default risk, which of the following is NOT true? A. Cost of riskless debt
If the corporate tax rate is zero and there is no default risk, which of the following is NOT true?
| A. | Cost of riskless debt does not depend on capital structure. | |
| B. | Cost of capital does not depend on capital structure. | |
| C. | Cost of equity increases with financial leverage | |
| D. | All of the statements are true. | |
| E. | Cost of equity does not depend on capital structure |
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The Oxford Handbook Of State Capitalism And The Firm
Authors: Mike Wright, Geoffrey T. Wood, Alvaro Cuervo-Cazurra, Pei Sun, Ilya Okhmatovskiy, Anna Grosman
1st Edition
0198837364, 978-0198837367
