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MTrout, Inc., currently has a WACC of 13.2%. Describe how MTrout's WACC would change and how the net present value of new projects would change
MTrout, Inc., currently has a WACC of 13.2%. Describe how MTrout's WACC would change and how the net present value of new projects would change if the following things occurred. (You don't need to do any calculations. 1 sentence per item.) Ocurrance 1: The government decreases the tax rate for companies in MTrout's industry from 21% to 15%. WACC impact: NPV impact: Occurance 2: Congress investigages anticompetitive issues with MTrout. Investors view the company as riskier and assign it a higher beta. WACC impact: NPV impact
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