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Memphic Memphic
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6 years ago
If a firm's excess cash holdings are greater than its debt, using net debt as the measure of leverage will result in:
A) its unlevered beta and cost of capital equalling zero.
B) its unlevered beta and cost of capital being greater than its equity beta and cost of capital.
C) the risk of the firm's equity being increased by its cash holdings in excess of its operating needs.
D) the risk of the firm's debt being increased by its cash holdings in excess of its operating needs.
Textbook 
Corporate Finance: The Core

Corporate Finance: The Core


Edition: 4th
Authors:
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EgorGruzdevEgorGruzdev
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6 years ago
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Memphic Author
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6 years ago
Correct Slight Smile TY
ethom947
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Yesterday
Smart ... Thanks!
Gorgio_De
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2 hours ago
this is exactly what I needed
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