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The current weighted average cost of capital (WACC) for Company is 10%. The company announced a debt offering that raises the WACC to 13%. The
The current weighted average cost of capital (WACC) for Company is 10%. The company announced a debt offering that raises the WACC to 13%. The most likely conclusion is that for Company
a) The company's prospects are improving b) equity financing is cheaper than debt financing c) the company's debt/equity ratio has moved beyond the optimal range
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