Which of the Following Changes Would Tend to Increase the Company

question 19

Multiple Choice

Which of the following changes would tend to increase the company cost of capital for a traditional firm?

• A)decrease the proportion of equity financing.
• B)increase the market value of the debt.
• C)decrease the proportion of debt financing.
• D)Decrease the market value of the equity.

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Definitions:

Larger Number

The value in a comparison of numbers that is greater than the other(s).

Smaller Number

In a comparison of two or more numbers, the one that is less in value.

Unit Price

The cost per single unit of measure, facilitating cost comparison among similar products.

Tissues Per Box

It indicates the number of individual tissue sheets contained within a single box.