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Q14-Which one of the following statements is correct for a firm that uses debt in its capital structure? Select one: a.the firm's WACC will decrease
Q14-Which one of the following statements is correct for a firm that uses debt in its capital structure? Select one: a.the firm's WACC will decrease as the corporate tax rate decreases. b. when computing the WACC, the weight assigned to the preferred stock is based on the coupon rate multiplied by the par value of the preferred. c.the WACC will remain constant unless a firm retires some of its debt. d.the WACC should decrease as the firm's debt-equity ratio increases. e.the weight of the common stock used in the computation of the WACC is based on the number of shares outstanding multiplied by the book value per share. Q15-It is possible that hedging does not add much value for shareholders, but it may still benefit managers. Select one: True False
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