QUESTION $28$

Value of the leveraged firm as compared to an identical unleveraged firm increases with an increase in

Tax rates on interest income

Tax rates on dividend income

Tax rates on Corporate income

Market value of debt

Tax on Corporate Income and market Value of Debt

QUESTION $29$

Which of the following statements is CORRECT?

Only a decrease in payout ratio leads to a higher growth.

Only higher growth leads to a higher value for the firm.

Only firms paying high dividends have high value.

High cost of equity leads to high value.

Firms with high growth and low cost of equity have high value.