Question: Intro Company A and Company B have the same basic business model and the same asset composition. Company A is financed with 50% debt and

Intro Company A and Company B have the same basic business

Intro Company A and Company B have the same basic business model and the same asset composition. Company A is financed with 50% debt and Company B has no debt. For simplicity, assume that there are no taxes. Part 1 * Attempt 1/1 for 10 pts. What is true about the cost of equity for each company? Company A has a higher cost of equity than Company B Company A and Company B have the same cost of equity Company B has a higher cost of equity than Company A Save

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