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    Principles of Corporate Finance Study Set 4
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    Exam 10: Leverage and Capital Structure
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    Due to Its Secondary Position Relative to Equity, Suppliers of Debt
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Due to Its Secondary Position Relative to Equity, Suppliers of Debt

Question 27

Question 27

True/False

Due to its secondary position relative to equity, suppliers of debt capital take greater risk and therefore must be compensated with higher expected returns than suppliers of equity capital.

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