Multiple Choice
Which of the following is true of the change in the weighted average cost of capital of a firm?
A) A decrease in the weighted average cost of the capital increases the value of the firm.
B) An increase in the weighted average cost of the capital increases the value of the firm.
C) A decrease in the weighted average cost of the capital decreases the value of the firm.
D) A decrease in the weighted average cost of the capital increases the cash flow generated by the investments.
E) Any change in the weighted average cost of capital results in no change in the value of the firm.
Correct Answer:
Verified
Correct Answer:
Verified
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