Other things equal, which of the following will decrease the WACC of a firm that has both debt and equity in its capital structure? An increase in the expected market return An increase in the tax rate An increase in the yield on preferred stock An increase in the stock's beta

Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter11: Risk-adjusted Expected Rates Of Return And The Dividends Valuation Approach
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Other things equal, which of the following will decrease the WACC of a firm that has both debt and equity in its capital structure?
An increase in the expected market return
An increase in the tax rate
An increase in the yield on preferred stock
An increase in the stock's beta
Transcribed Image Text:Other things equal, which of the following will decrease the WACC of a firm that has both debt and equity in its capital structure? An increase in the expected market return An increase in the tax rate An increase in the yield on preferred stock An increase in the stock's beta
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