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papahomer papahomer
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6 years ago
Which of the following will happen if the original Modigliani and Miller Theorem is relaxed to include taxes, but not bankruptcy costs?
A) Increased usage of financial leverage will increase a firm's weighted average cost of capital indefinitely.
B) Increased usage of financial leverage will lower a firm's weighted average cost of capital indefinitely.
C) Increased usage of financial leverage will not affect a firm's weighted average cost of capital.
D) Increased usage of operating leverage will increase a firm's weighted average cost of capital indefinitely.
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Financial Management: Principles and Applications

Financial Management: Principles and Applications


Edition: 13th
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David_hessDavid_hess
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6 years ago
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