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Business, 20.08.2019 19:10 kat9940

Which of the following statements is most correct? a) because the cost of debt is lower than the cost of equity, value-maximizing firms maintain debt ratios of close to 100%.b) corporations that are 100% equity financed will have a much lower weighted average cost of capital because the lack of debt lowers their risk of bankruptcy. c) the source of capital with the lowest after-tax cost is preferred stock, because it is a hybrid security, part debt and part equity. d) the cost of a particular source of capital is equal to the investor's required rate of return after adjusting for the effects of both flotation costs and corporate taxes.

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Which of the following statements is most correct? a) because the cost of debt is lower than the co...
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