Question: 5. True, False, or Uncertain. Prove your answer. (3) a. If a debt-using firm has a negative return on equity, its leverage gain must be

5. True, False, or Uncertain. Prove your answer. (3) a. If

5. True, False, or Uncertain. Prove your answer. (3) a. If a debt-using firm has a negative return on equity, its leverage gain must be negative. (3) b. If the leverage gain is negative, then the profitability premium will always be negative. (3) c. In a world of perfect markets with a tax rate of 30%, an unlevered firm has a V of $10,000. If it now increases B to $2,000 and reduces SE by $2,000, V will increase to $12,000

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