Question five:

A$.$ What is capital structure? Explain the two school of capital structure with graph when necessary?

B$.$ Using the following data to provide support for NOI approach,

Net Operating income $$5000$

Market value of debit is $$3000$ at $8\%$

Overall capitalization rate is $14\%$

What if we increase the value of debit to $$4000$ would it lower the WACC?

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