Describe a wacc

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Describe a WACC - decisions

Most capital structure models ignore dividends, and most dividend models assume firms use only equity financing. However, there are reasons to believe that capital structure and dividend policy are related. Would you expect there to be positive or negative relationship between debt and dividends (i.e., would you expect firms paying relatively high dividends to have high or low debt levels)? Explain your reasoning within the context of the models discussed in class.

Reference no: EM1317383

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