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We studied 3 components of firms capital structure, i.e., equity, debt, and retained earnings. Now, if debt is added to a firm which only had
We studied 3 components of firms capital structure, i.e., equity, debt, and retained earnings. Now, if debt is added to a firm which only had equity before what happens?
Multiple Choice
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cost of debt can be expected to fall.
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WACC will increase.
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WACC will be unaffected.
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WACC will decline.
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cost of debt can be expected to rise.
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