Beginning with a zero-leverage company, as debt is substituted for equ
Beginning with a zero-leverage company, as debt is substituted for equity in the capital structure ________.
A) the overall cost of capital first rises, reaches a maximum, and then declines
B) the overall cost of capital declines
C) the overall cost of capital first declines, reaches a minimum, and then rises
D) the overall cost of capital rises
ANSWER
C
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