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Author Question: In a perfect world of no taxes, what happens if the weighted average cost of capital (WACC) is ... (Read 56 times)

am7272

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Question 1

If the value of a levered firm is $7 million, what is the value of the same firm with all-equity financing?

$7 million


$6 million


$8 million


$10 million



Question 2

In a perfect world of no taxes, what happens if the weighted average cost of capital (WACC) is unaffected by the capital structure?

SML is upward sloping.


MM Proposition II holds.


MM Proposition I holds.


SML is downward sloping.



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Marked as best answer by am7272 on Aug 7, 2023

dadgoere765

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am7272

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Reply 2 on: Aug 7, 2023
Excellent


Missbam101

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Reply 3 on: Yesterday
Thanks for the timely response, appreciate it

 

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