if bankruptcy were costless and there were no information asymmetry, but interest payments are tax-deductible, what is the weighted average cost of capital?

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if bankruptcy were costless and there were no information asymmetry, but interest payments are tax-deductible, what is the weighted average cost of capital?

college finance Multiple-Choice

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Answer 1

Answer #1

the WACC is the weighted average of the cost of equity and the after-tax cost of debt.

Note: WACC is weighted average cost of capital.

answered by: Andrew San Andres

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Answer 2

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if bankruptcy were costless and there were no information asymmetry, but interest payments are tax-deductible, what is the weighted average cost of capital?

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if bankruptcy were costless and there were no information asymmetry, but interest payments are tax-deductible, what is the weighted average cost of capital?

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Since interest payments are fully deductible for tax purposes should a firm’s capital structure be all...

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if bankruptcy were costless and there were no information asymmetry, but interest payments are tax-deductible, what is the weighted average cost of capital?

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if bankruptcy were costless and there were no information asymmetry, but interest payments are tax-deductible, what is the weighted average cost of capital?