Question
When the WACC formula is applied to cost of capital the outcome seems to imply that debt is cheaper than equity; this implies that a
When the WACC formula is applied to cost of capital the outcome seems to imply that debt is "cheaper" than equity; this implies that a firm with more debt could use a lower discount rate. Does this make sense? Explain your answer.
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The Economics Of Money Banking And Financial Markets
Authors: Frederic S. Mishkin
7th Edition
0321122356, 978-0321122353
