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Question B2 1. Cost-benefit analysis of debt indicates that firms should chose a debt level which minimise its cost and maximises it benefits and ultimately

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Question B2 1. Cost-benefit analysis of debt indicates that firms should chose a debt level which minimise its cost and maximises it benefits and ultimately enhances shareholders' wealth. Critically analyse and evaluate the: a. Benefits of debts. 4 Marks b. Costs of debts. 4 Marks c. Does optimal debt level maximise firm's value? 2 Marks

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