Question: All else equal, as debt is added to the capital structure, the: A: WACC will continually increase. B: WACC will continually decline. C: cost of

All else equal, as debt is added to the capital structure, the:

A: WACC will continually increase.

B: WACC will continually decline.

C: cost of debt can be expected to rise.

D: WACC will be unaffected.

What is the debt ratio of a firm that has $22 million in outstanding bonds and equity with a market value of $28 million?

A: 56%

B: 25%

C: 42%

D: 44%

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