Beginning with a zeroleverage company as debt is substitute

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  • Beginning with a zero-leverage company, as debt is substituted for equity in the capital structure ________.
  1. the overall cost of capital declines
  2. the overall cost of capital first rises, reaches a maximum, and then declines
  3. the overall cost of capital first declines, reaches a minimum, and then rises
  4. the overall cost of capital rises

 

 

Reference no: EM13813054

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