The Adjusted Present Value Method

question 13

Multiple Choice

The adjusted present value method:

• A)calculates the NPV of the all-equity-financed project and adds the value of the tax benefits of debt.
• B)accounts for any benefits of debt by adjusting the discount rate.
• C)calculates the NPV of the all-equity-financed project and discounts by the cost of capital.
• D)discounts only one set of cash flows.

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Definitions:

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