The APV Method Is Comprised of the All Equity NPV

question 23

Multiple Choice

The APV method is comprised of the all equity NPV of a project and the NPV of financing effects. The four side effects are:

• A) tax subsidy of dividends, cost of issuing new securities, subsidy of financial distress and cost of debt financing.
• B) cost of issuing new securities, cost of financial distress, tax subsidy of debt and other subsidies to debt financing.
• C) cost of issuing new securities, cost of financial distress, tax subsidy of dividends and cost of debt financing.
• D) subsidy of financial distress, tax subsidy of debt, cost of other debt financing and cost of issuing new securities.

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Definitions:

Dysfunctional Behavior

Actions that are counterproductive to an individual’s own goals or well-being, often causing negative effects on others around them.

Fixation

An aggressive mechanism in which an individual keeps up a dysfunctional behavior that obviously will not solve the conflict.

Aggressive Mechanism

Psychological strategies or behaviors used to express hostility or to assert dominance over others.

Defining Moments

Critical points or events that have a significant impact and influence the direction of an individual's life or an organization's path.